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Context

The Union Minister for Ports, Shipping and Waterways inaugurated the Green Hydrogen pilot plant at V.O.Chidambaranar Port at Tuticorin in Tamil Nadu.

What is Green Hydrogen?

Green hydrogen is a clean fuel produced by splitting water into hydrogen and oxygen through electrolysis powered by renewable energy sources like solar or wind.\

Unlike grey hydrogen (from fossil fuels) or blue hydrogen (from natural gas with carbon capture), green hydrogen emits no greenhouse gases during production, making it a zero-emission energy carrier.

Key Features

• High Energy Content: Hydrogen has the highest energy content by weight, ideal for energy-intensive applications like rocket fuel 
• Versatile Applications: Used in transportation, industry (e.g., steel, ammonia production), and energy storage.
• Eco-Friendly Byproduct: Produces water vapor when used, unlike fossil fuels that emit CO2.

India’s Green Hydrogen Ambitions

India aims to produce 5 million metric tonnes (MMT) of green hydrogen annually by 2030, with a potential to reach 10 MMT for exports.

National Green Hydrogen Mission (NGHM)

• Objectives: Boost production, develop infrastructure, and create export markets.
• Budget of ₹19,744 crore, targets reducing green hydrogen costs to $1/kg by 2030 to compete globally.
• Key Programs:
• SIGHT Program: Allocates incentives for green hydrogen production (862,000 tonnes/year to 18 companies) and electrolyzer manufacturing (3,000 MW/year to 15 companies) as of August 2025.
• Green Hydrogen Hubs: Targets 100,000 tonnes/year per hub near ports or industrial clusters.
• Green Hydrogen Policy (2022): Waives interstate transmission charges for projects until 2030 and allows 30-day renewable energy banking.
• Economic Impact: Expected to create 6 lakh jobs and save ₹1 lakh crore in fossil fuel imports by 2030.

State-Level Support

States like Odisha, Tamil Nadu, and Gujarat offer incentives worth ₹5.05 lakh crore, 26 times the NGHM budget.

• Odisha: ₹1.25 lakh crore in incentives, including ₹3/unit power tariff rebates.
• Rajasthan: Focuses on non-power incentives with a 2 MMT production target.

Opportunities for India

Decarbonization: Green hydrogen can replace fossil fuels in hard-to-abate sectors like steel and fertilizers, reducing emissions.

Energy Security: Local production reduces dependence on imported fossil fuels, enhancing energy independence.

Export Potential: India aims to supply 10% of global green hydrogen demand by 2030, targeting markets like Japan and the EU.

Economic Growth: Cumulative value of the green hydrogen market in India could reach $8 billion by 2030, and $340 billion by 2050. (NITI Aayog)

Global Leadership: Strategic partnerships with Saudi Arabia (via IMEC) and Japan (Clean Energy Partnership) position India as a key player in green hydrogen production and export.

Challenges in Scaling Green Hydrogen

High Costs

• Green hydrogen costs $3.5–5/kg, compared to grey hydrogen at $2/kg.
• Electrical systems account for 30–50% of capital costs, and electrolyzers degrade faster with intermittent renewables.

Infrastructure Gaps

• Limited pipelines, storage systems, and refueling stations hinder scalability.
• Scaling up electrolyzer manufacturing remains a bottleneck.

Resource Constraints

• Producing 5 MMT requires 50 billion liters of demineralized water, challenging in water-scarce regions.
• Land acquisition for renewable projects faces environmental and social risks.

Financing Hurdles

• High capital costs deter private investment.
• Technology risks in electrolyzers and storage add uncertainty.

Environmental Concerns

• Life-cycle emissions from renewable component manufacturing and hydrogen leakage are often overlooked.
• Sustainable biomass sourcing is critical to avoid deforestation.

Way Forward for India

Cost Reduction

• Waive GST on electrolyzers (18%) and renewable components (13.8%) to cut costs.
• Offer low-cost green debt to reduce financing costs.

Infrastructure Development

• Build dedicated hydrogen pipelines and retrofit natural gas networks for blending.
• Develop Green Hydrogen Hubs near ports using PM Gati Shakti mapping.

Demand Creation

• Mandate Green Hydrogen Purchase Obligations (HPO) for industries like fertilizers.
• Use the Carbon Credit Trading Scheme to incentivize adoption.

Research and Innovation

• Increase R&D funding beyond the NGHM’s funds to develop efficient electrolyzers, by providing incentives to the private sector.
• Leverage the Anusandhan National Research Foundation for innovation.

International Collaboration

• Strengthen ties with Saudi Arabia and Japan for R&D and trade..
• Align with International Maritime Organization's (IMO) Net Zero Framework to boost green ammonia exports.

Conclusion

Green hydrogen is a game-changer for energy transition, offering a path to decarbonize industries, enhance energy security, and lead globally. By streamlining policies, boosting R&D, and promoting global partnerships, India can achieve its ambitious targets and emerge as a green hydrogen powerhouse by 2030.

  Source: NEWSONAIR