India's Green Hydrogen Initiative: Charting a Sustainable Future Amidst Climate Challenges

The world is grappling with the climate crisis. We are already witnessing environmental degradation, natural disasters, weather extremes, food and water insecurity, economic disruption, conflict, and terrorism fuelled by rising temperatures. The earth has witnessed eight warmest years on record since 2014, and the world is now 1.2 degrees Celsius hotter than it was in the second half of the 19th century when emissions became widespread. The 2015 Paris deal, which aimed to prevent the world’s average temperature rising 1.5C above pre-industrial times, is woefully falling short. If current practices continue, we will soon be witnessing nearly 3C in warming. The developing countries will be severely affected.

India is also bearing the brunt of Mother Nature's fury. According to the Global Climate Risk Index 2021, India ranks seventh among the countries most susceptible and vulnerable to climate-related events. The Reserve Bank of India's recent report warns that by 2030, because of extreme heat and humidity leading to decreased labour productivity, up to 4.5 per cent of India's GDP could be in jeopardy. Therefore, the Indian government has adopted various measures to prevent and battle against the climate crisis, such as reducing the emissions intensity of its Gross Domestic Product (GDP) by 45% by 2030 and has set its sight on becoming energy independent by 2047 and achieving Net Zero by 2070. To fulfil this promise, the role of Green Hydrogen becomes paramount.

Historically, hydrogen has been pivotal in various sectors, including fertilizer production and oil refining. However, traditional hydrogen production from natural gas emits significant greenhouse gases, around 11.1 to 13.7 kilograms of CO2 equivalent per kilogram of hydrogen. To mitigate this, India has launched the National Green Hydrogen Mission with an allocation of ₹19,744 crore, targeting the production of 5 million tonnes of green hydrogen annually by 2030.

Green hydrogen is generated by passing an electric current through water (H2O) in an electrolyser, splitting water molecules into hydrogen (H2) and oxygen (O2). What sets green hydrogen apart is its use of electricity from renewable sources like solar, wind, or hydropower, ensuring a minimal environmental footprint. Furthermore, it serves as a clean energy source for hydrogen fuel cells, powering vehicles and stationary systems, while also being a raw material for industrial processes like ammonia production and steelmaking. This transition to green hydrogen can potentially reduce India's carbon emissions by around 50 million metric tons and save over $12 billion on fossil fuel imports.

Nevertheless, this transition is not without challenges. Green hydrogen production costs in India currently range from 320 to 330 rupees per kilogram, while conventional grey hydrogen costs just 160 to 200 rupees per kilogram. To bridge this gap, the National Green Hydrogen Policy offers incentives, including open access to renewable energy without central surcharges and a 25-year exemption from inter-state transmission charges for projects commissioned before June 30, 2025. Additionally, the government has allocated 17,490 crore rupees over five years to bolster electrolyser production, further reducing green hydrogen costs.

Water availability poses another significant hurdle, as green hydrogen production demands nine litres of water per kilogram. To produce 6 million tonnes of green hydrogen, India would require an estimated 132-192 million tonnes of water, roughly 10% of Delhi's annual water requirement. The use of municipal and industrial wastewater is explored as a solution, but the electrolysis process thrives on "demineralized" freshwater. Research into alternative water sources is critical, and if experiments using direct seawater electrolysis prove commercially viable, it could alleviate this challenge. In addition to water, land availability is another critical concern. A standard green hydrogen (GH2) facility producing 10 tonnes per day necessitates an electrolyser with a capacity of 5000 m3/hour, requiring a renewable energy supply from a 150 MW plant. Such a plant typically occupies approximately 750 acres of land. This becomes increasingly challenging in the context of a growing population and economy, where land resources are becoming increasingly scarce. So, the government should also mindful while diverting the land.

India's National Hydrogen Policy represents a strategic response to the climate crisis. Green hydrogen's potential to decarbonize various sectors, coupled with policy incentives, positions India to play a crucial role in achieving its climate goals and make India the Global Hub for the production, usage and export of Green Hydrogen and its derivatives and part of the global market for green hydrogen is expected $410 billion green hydrogen market by 2030. However, as outlined in the policy creating demand while enabling adequate supply by increasing the domestic electrolyser manufacturing capacity is a crucial first step in the entire process while mindful of land and water. The initiative will be truly successful when states unveil their green hydrogen (GH2) policies, outlining clear provisions for incentives, such as tax exemptions, subsidies, infrastructure support, and financial backing, fostering a genuine culture of competitive federalism.