Is green hydrogen the ‘energy of the future’ for India?
India is increasingly looking towards hydrogen as an alternative source of fuel to reduce its carbon footprint and meet its growing energy needs. While launching the nation’s hydrogen mission on August 15, Prime Minister Narendra Modi declared that “the thing that is going to help India with a quantum leap in terms of climate (target) is green hydrogen”. About 40 percent of India’s energy demand is imported currently at a cost of US$160 billion. By moving to a hydrogen economy, India can not only reduce imports of oil, coal, and natural gas, but will also be able to export hydrogen to other countries in Europe and Asia. Thanks to its geography, India has the potential to produce 210 million tonnes per annum (598 million tonnes of oil equivalent) of hydrogen from solar and wind and meet 32 percent of Asia-Pacific’s (APAC’s) hydrogen demand.
Hydrogen, combined with air, produces energy and water vapour, packs more energy per kilogram than several fuels. Most importantly, apart from being a fuel, hydrogen acts as feedstock in the refining, fertiliser, and chemical industries, and is gradually replacing carbon as a feedstock in the iron and steel industry too. Thus, just one hydrogen production plant can address the demand requirements of several applications.
However, unlike fossil fuels, which are readily available in natural form, hydrogen has to be extracted from feedstocks such as natural gas, water or biomass. To make zero emission hydrogen or green hydrogen competitive with fossil fuels, its price has to be brought down to around Rs INR 75–150/kg. Grey hydrogen, produced from natural gas, is already available at Rs 150/kg, but it leads to emission of 9.21 kg of CO2 for every kg of hydrogen produced, and hence is not a preferred choice. Alternatively, hydrogen can be produced by splitting water using just electricity without any emissions, by a process called water electrolysis. But historically, this process has been hampered by electricity costs, accounting for about 50-60 percent of total hydrogen production. However, with falling renewable prices falling drastically and funds inflowing numerous large large-scale green hydrogen projects coming up globally, including 20 in India.
Soaring demand
India has a hydrogen production capacity of 6 million tonnes per annum at present. Most of this is a captive capacity and mainly produced using natural gas within refineries and fertiliser industries. With a hydrogen economy, production technologies would need a makeover to greener methods such as electrolysis. New demand sectors – green steel, green ammonia, green methanol, green fuel, and so on – would create a projected demand of 9 million tonnes per annum by 2030 and 40 million tonnes per annum by 2060, according to a study. Indian officials have the country would need an investment of US$15 billion by 2030 and US$1 trillion by 2060 to meet this demand.
Eyeing rosy business opportunities, the Reliance Industries has announced investment of Rs 75,000 crore (US$75 billion) towards green power, which includes electrolyser and fuel cell giga factories. State-run National Thermal Power Corporation (NTPC) and Indian Oil Corporation have announced projects worth thousands of cores of rupees for production of green hydrogen, while Indian Railways is exploring retrofitting of diesel engines with fuel cells to run on hydrogen. Jindal Steel is also exploring production of green steel, while the central government is planning to make hydrogen a part of Renewable Purchase Obligations and Green Hydrogen Consumption Obligation in fertiliser production and petroleum refining.
However, achieving such ambitions will be a challenging task, given the relatively high cost of hydrogen production, various problems in terms of technology, storage, transportation, new materials research, electrolysis development, safety standards and a regulatory framework. But it is also essential for the country to boost its power generation capacity. The International Energy Agency (IEA) has forecast that demand for energy in India will grow more than any other country over the next 20 years, driven by expanding economic activity and urbanisation. By moving to a hydrogen economy, India can reduce energy imports and alter the geopolitical landscape as an energy exporter.
“In this nascent market, with an informed understanding of demand opportunities, alongside clear vision and right policy structures, India can reap good dividends from its hydrogen economy. More transparency from the National Hydrogen Mission on its activities, quick rolling of a Hydrogen Mission document from the Ministry of New and Renewable Energy and Detailed Project Report from Department of Science and Technology would help in better understanding India’s hydrogen demand trajectory”. ((Viswanath Dibbur, consultant at the Centre for Study of Science, Technology and Policy (CSTEP), a research think-tank).
