India’s Green Hydrogen Policy


Author: Arpan Tewary and Chandan Upadhyay

Energy Review, Vol 4. Issue 6. 2022

Hydrogen is considered to be a clean fuel. It is light but has a very high gravimetric energy density hence more energy content. This makes hydrogen capable to satisfy almost all kinds of human energy requirements globally. Considering the damage suffered by the ecosystem worldwide over the years due to the ruthless exploitation and excessive use of fossil fuels, swift movement from a carbon-driven economy to a hydrogen-driven economy is the need of the hour. This will indeed help us mitigate issues like climate change and achieve net-zero at the earliest.

Green Hydrogen is the most sustainable form of hydrogen which is obtained through the electrolysis of water. It will be instrumental toward swift energy transition for a secured future. Reportedly, less than 1 – 2% approximately of Green Hydrogen is only produced as of today. In contrast, grey and blue hydrogen that are obtained from the burning of fossil fuels and the reforming of natural gas respectively dominate the hydrogen production sector. Since the progress of countries is largely dependent on their future energy policies, India in concurrence with many other developing nations has spiritedly stepped into this space. On the historic occasion of our 75th Independence Day, the honourable Prime Minister of our country Shri Narendra Modi announced the National Hydrogen Mission. The futuristic mission aims at transforming India into a global green hydrogen production and export hub. Furthermore, on 17th February 2022, the Government of India, via the Ministry of Power (MoP), officially notified the “Green Hydrogen Policy 2022”. However, the Ministry of New and Renewable Energy (MNRE) is the nodal ministry for the necessary planning and nationwide implementation of this scheme. This scheme is not only limited to Green Hydrogen only but also encourages the production and export of Green Ammonia as well. Industry players have mostly welcomed it, as it aligns with India's 2022-23 budget's climate-action focus. This initiative is a step toward India’s strong commitments to reducing carbon emissions, achieving net-zero by 2070 or even earlier, and meaningfully contributing towards building a sustainable planet. This is in pursuance of the promises made by the Govt. of India on behalf of its people in several global environmental summits such as the Paris Agreement, COP26, etc. for preventing climate change by cutting down its carbon emissions following the Nationally Determined Contributions (NDC) framework as followed by other countries as well. Hence, this mission shall help India achieve a lot within a stipulated time. It shall also provide a necessary push for other initiatives of national importance and the common goals of Atmanirbhar Bharat, Swachh Bharat, and Swasth Bharat.

The mission will aid in attaining the goal of producing 5 million tonnes of green hydrogen by 2030 and the growth of renewable energy capacity that goes with it. The “Green Hydrogen Policy” has several distinctive features as mentioned below.

1). Green Hydrogen/Green Ammonia should be produced from the electrolysis of water or biomass using renewable energy sources.

2). Interstate transmission charges are to be waived off for 25 years for projects commissioned before the end of June 2025 thus benefitting the producers of Green Hydrogen/Green Ammonia.

3). Green Hydrogen/Green Ammonia can be produced using renewable energy produced by the developer on his own at the same site, outsourced from some other place or procured from a third party or power exchange. Banked renewable energy for up to 30 days can also be used to run such plants.

4). The banking expenses will be fixed by the state commission and will not exceed the price difference between the average tariff of renewable energy purchased by the distribution licensee over the preceding year and the average MCP (Market Clearing Price) in the DAM (Day Ahead of the Market) during the month in which renewable energy was stored.

5). As per the new Electricity regulation (2021), connectivity to the Inter-State Transmission system for sustainable energy capacity build-up will be approved on a priority basis at the generation end as well on the Green Hydrogen/Green Ammonia production end.

6). Land in Renewable Energy Parks, Manufacturing Zones and Ports can be provided for building facilities to produce, store and ship Green Hydrogen/Green Ammonia following due procedures.

7). The MNRE shall set up a single portal to facilitate all kinds of consents and approvals within an adequate time frame for smooth functioning of the Green Hydrogen/Green Ammonia industry.

8). The MNRE shall be responsible for competitive pricing and procurement of Green Hydrogen/Green Ammonia through authorized implementing agencies.

Although Hydrogen energy is a good alternative, the production, storage, transportation, and distribution of hydrogen are often met with several constraints, including safety. Therefore, any kind of carelessness can potentially cause huge damage to both life and property. Since the ball is already set for rolling and the countless number of initiatives being taken by the governmental and non-governmental sectors towards developing the opportunistic hydrogen energy sector in India the days are not far behind when we will certainly see the fruits of these initiatives effectively contributing toward nation-building.

(Mr. Arpan Tewary is a Project Engineer at the National Thermal Power Corporation, New Delhi, and Mr. Chandan Upadhyay is a postgraduate from R.M.L. Avadh University, Uttar Pradesh, India.)■□■

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