The recent successes of renewable energy technologies and electric vehicles have shown that policy and technology innovation have the power to build global clean energy industries. Hydrogen is emerging as one of the leading options for storing energy from renewables with hydrogen-based fuels potentially transporting energy from renewables over long distances. The government of India launched the country’s first green hydrogen policy as part of its energy transition plan. The objective is to reduce fossil fuel usage and increase penetration of green fuels. The policy follows Prime Minister Narendra Modi’s announcement about a National Hydrogen Mission last Independence Day. The new policy provides several incentives for manufacturers, consumers of green hydrogen and green ammonia.
What is Hydrogen Energy?
Hydrogen is obtained after separating hydrogen and oxygen from water. Hydrogen can also be manufactured by coal gasification and from methanol. Electolyser is used to extract hydrogen. Green hydrogen is formed as a result of electrolysis for renewable energy.
The Centre has set itself a target of setting up a 5 million tonnes (mt) green hydrogen production by 2030. Because hydrogen only emits water as a residue when burnt, it is pitched as a potential substitute for fossil fuel and help in Indias transition away from polluting fuel sources.
A notification by the Power Ministry exclaims that manufacturers of green hydrogen or ammonia may purchase renewable power from the power exchange or set up renewable energy capacity themselves or through any other developer anywhere. Inter-State transmission charges will be waived for 25 years for such manufacturers and they can also bank unconsumed renewable power, up to 30 days, with distribution company and take it back when required.
The power ministry, which launched the policy, has proposed to set up manufacturing zones for production of green hydrogen and ammonia. It has also said these manufacturers “shall be allowed to set up bunkers near ports for storage of green ammonia for export / use by shipping.” Land for storage will be provided by port authorities at applicable charges. Green hydrogen is defined as hydrogen produced by splitting water into hydrogen and oxygen using renewable electricity. This is a very different pathway compared to both grey and blue.
Dilip Oommen, President of Indian Steel Association (ISA) says, “We welcome the Green Hydrogen Policy, which demonstrates the Government’s firm commitment towards decarbonisation efforts and make India a green hydrogen hub. This policy will give further impetus to promote cleaner and greener energy, bridge the gap between demand and supply to improve availability and is a step in the right direction to ensure availability at a competitive price. I am confident that the steel sector will benefit from this policy and will contribute significantly to our Climate Change efforts.”
The government is set to provide a single portal for all clearances required for setting up green hydrogen production as well as a facility for producers to bank any surplus renewable energy generated with discoms for upto 30 days and use it as required.