Explained | Green Hydrogen and India’s ambitious decarbonizing plans

As India updates its Nationally Determined Contribution (NDC) and submits it before the United Nations, the country plans to bet big next on ‘green hydrogen’ production to meet its climate targets and reduce dependency on energy imports. India is about to launch a full-fledged ‘National Green Hydrogen Mission’ under which a comprehensive ‘Green Hydrogen Policy’ will include new compulsory consumption targets for specific sectors like the petroleum refining industry and fertilizer production to incentivize demand. If reports are to be believed, India is aiming for an annual production capacity of 25 million tons of Green Hydrogen by 2047. 

What is Green Hydrogen?

Green hydrogen is produced through the electrolysis of water, splitting water into hydrogen and oxygen. The power required to do so is sourced from renewable energy. 

According to a Union Government notification at the launch of a short summary of the ‘Green Hydrogen Policy’ in February 2022, “Green hydrogen/green ammonia shall be defined as hydrogen/ammonia produced by way of electrolysis of water using renewable energy; including renewable energy which has been banked and the hydrogen/ammonia produced from biomass.”

While there are many ‘colours’ of hydrogen, each referring to how it is produced, ‘green hydrogen’ is the only variant that is produced in a climate-neutral manner and could play a significant role in the achievement of global net-zero goals. ‘Green Hydrogen’ could be a replacement for ‘hydrogen’ derived from fossil fuels and even coal.  

Black, Brown and Grey Hydrogen

The most common form of hydrogen at present is Grey Hydrogen which is generated from natural gas, or methane, and involves a process called “steam reforming”. This process generates comparatively just a smaller amount of emission than black or brown hydrogen.

Black or brown hydrogen uses black (bituminous) or brown (lignite) coal in the hydrogen-making process. Both the carbon dioxide and carbon monoxide generated during the process are not recaptured and hence it is the most environmentally damaging variant. 

Blue hydrogen

When carbon generated during the ‘steam reforming’ process for ‘Hydrogen making’ is captured and stored underground through industrial carbon capture and storage (CSS), the Hydrogen hence made is termed ‘Blue Hydrogen’. 

Though Blue hydrogen is sometimes referred to as carbon neutral, it is also termed as ‘low carbon’ for greater accuracy as 10-20% of the generated carbon cannot be captured and prevented from going back into the atmosphere. 

India’s tryst with Green Hydrogen 

The PM’s Independence Day speech in 2021 had signaled the launch of the National Hydrogen Mission attesting to India’s intent to be a global hub for green hydrogen. India’s unique advantage in being able to generate low-cost renewable energy and the fact that green hydrogen is generated using renewable energy enable India to potentially emerge as one of the most competitive producers of green hydrogen globally. 

In February 2022, the Union Government notified the green hydrogen policy aiming to boost domestic production of green hydrogen to 5 million tonnes by 2030. As per the new policy, before July 2025, any new renewable energy plant set up to supply power for green hydrogen production will enjoy 25 years of free power transmission without having to pay any inter-state transmission charges. Also, a single portal for all clearances involving the setting up of a green hydrogen production unit will be provided, according to the policy. 

According to an exclusive report by Lights On, ‘the latest draft of the much-awaited new policy under the National Green Hydrogen Mission (NGHM) sets new compulsory consumption targets’ to be known as Green Hydrogen Consumption Obligations (GHCO) ‘for specific sectors to incentivise demand.’ 

The report says, “Oil refineries will be required to replace 30 percent of their fuel usage with green hydrogen by 2035, starting from 3 percent in 2025. By 2035, fertilizer production should run on 70 percent green hydrogen, starting from 15 percent in 2025, and by the same year urban gas distribution networks should replace 15 percent of their fuel volume, starting from 5 percent in 2025.” 

The report however also mentioned that ‘the feasibility of these ambitious figures is still being debated, but the GHCO framework will remain in place in the final version of the policy.’

India Inc’s next big thing?

Recently, Reliance Industries chairman Mukesh Ambani, during the company’s AGM announced a plan to shift to Green Hydrogen and start the transition by 2025. The company has partnered with Stiesdal, a climate technology company, reports said. 

The Adani Group too recently announced that it has partnered with France’s TotalEnergies to invest $50 billion over the next 10 years in India to produce green hydrogen and develop an ecosystem around it. 

Oil and Natural Gas Corporation (ONGC) signed a Memorandum of Understanding (MoU) in July 2022 with renewable energy company Greenko ZeroC, ‘to make green hydrogen and to jointly pursue opportunities in renewables, and other derivatives of green hydrogen’. 

Global steelmaker POSCO too recently signed a memorandum of understanding (MoU) with renewable energy company Greenko ZeroC. The companies said in a joint statement that this will contribute towards the mission of making India a green hydrogen hub.

These developments concerning green hydrogen are happening at a time when energy companies in India including government-owned companies are investing in renewable energy as India has set a target for the country to turn carbon neutral by 2070.

Challenges ahead

While the opportunities seem to be in galore, it is also true that there are multiple challenges ahead. India must generate enough renewable energy to produce green hydrogen, invest in hydrogen infrastructure and ensure that the hydrogen economy is financially viable. 

“Renewable electricity for the production of green hydrogen is the main challenge for a country like India, which is facing an extremely high demand for electricity without adequate supply”, The National News quoted, Ashwini Kumar, a lawyer and climate advocate, as saying. “India cannot afford to divert its electricity for the production of green hydrogen unless the electricity generated is in excess of demand.”

Exporting green hydrogen might be quite a challenge given the fact that the nature of the gas makes long-distance transport expensive. Rising solar tariffs is another point of concern for India and might weaken the country’s competitiveness in the global market. Other concerns consist of facts like there is still dearth of good R&D in India in terms of green hydrogen production and production of cheap electrolyzer.