The government has granted $2.3 billion to boost green hydrogen production, consumption, and exports, with the goal of making India a global powerhouse for the young industry.
The money, which was revealed late Wednesday, is the first step toward building the ability to produce at least 5 million metric tons of green hydrogen by the end of the decade.
Green hydrogen is hydrogen created by the electrolysis of water using electricity supplied by sustainable sources of energy. The vast majority of the world’s hydrogen is produced from fossil fuels, particularly natural gas.
The aim of the funding initiative is “to make green hydrogen affordable and bring down its cost over the next five years. It will also help India reduce its emissions and become a major exporter in the field,” said Anurag Thakur, India’s minister for information and broadcasting.
He also stated that the funding will contribute to the addition of around 125 gigatonnes of renewable energy capacity by 2030. India had approximately 166 gigatonnes of renewable energy capacity as of October.
Other goals include creating more than 500,000 new employment, increasing private investment in the sector, reducing fossil fuel imports, and reducing greenhouse gas emissions by 50 million metric tons.
Many of India’s largest renewable energy corporations, including Adani Group, Reliance Industries, and JSW Energy; public sector organizations like Indian Oil and NTPC Limited; and renewable-only firms like Renew Power, are investing in green hydrogen generation.
Green hydrogen today accounts for only a small portion of worldwide hydrogen use
Green hydrogen today accounts for only a small portion of worldwide hydrogen use, which is expected to be around 70 million tons per year. The majority of commercially generated hydrogen is grey hydrogen, which is made using fossil fuels, and blue hydrogen, which is also made with fossil fuels but with carbon capture technologies to reduce emissions. Green hydrogen production produces low to no greenhouse gas emissions.
India is following the lead of many other countries, including China, the European Union, and the United States, in offering governmental incentives for green hydrogen generation. Energy researchers predict that production costs for green hydrogen will decline dramatically in the next years and that the green hydrogen industry will more than double to $80 billion by 2030.
“A robust policy framework, requisite financial support, and an enabling ecosystem for technology development are essential to displace the country’s conventional fuel mix with green hydrogen and enhance its industrial competitiveness in an increasingly decarbonizing world,” said Shreyans Jain, an India-based sustainable business strategy consultant who closely tracks developments in the green hydrogen industry.