Central Idea

• The 2023 Union Budget has allocated ₹19,700 crore for the National Green Hydrogen Mission. This will set in motion a programme that can position India as a green hydrogen (super)power.

What is Green Hydrogen?

• Clean and no harmful gas emission: The Green hydrogen is the one produced with no harmful greenhouse gas emissions.
• Produced by electrolysis of water: It is made by using clean electricity from surplus renewable energy sources, such as solar or wind power, to electrolyse water. Electrolysers use an electrochemical reaction to split water into its components of hydrogen and oxygen, emitting zero-carbon dioxide in the process.
• Clean energy source: It can serve as an energy source (heavy industry, long-distance mobility, aviation, and power storage) and an energy carrier (as green ammonia or blended with natural gas).
• Energy intensive process: It is an energy-intensive process for splitting water into hydrogen and oxygen using renewable power to achieve this.

All you need to know about National Green Hydrogen Mission

• The National Green Hydrogen Mission is a program launched by the government of India to promote the production and use of green hydrogen in the country.
• It aims to establish India as a leading producer and consumer of green hydrogen. The mission is expected to create demand for 100-125 gigawatts (GW) of renewable energy, 60-100 GW of electrolysers, and an investment opportunity of ₹8 lakh crore, while cutting 50 MMT of annual emissions.

Why is this important and what will it take?

• India’s ambitious renewable energy goal for 2030: By 2030, India aims to generate 50% of its electricity from non-fossil fuel sources, while also requiring an industrial energy transition.
• Industrial sectors contributing to India’s greenhouse gas emissions: Steel, cement, fertilizers, and petrochemicals contribute significantly to India’s industrial greenhouse gas emissions.
• Green hydrogen’s potential for fuelling industrial growth and reducing emissions: Green hydrogen has the potential to fuel industrial growth and reduce industrial emissions simultaneously.
• India’s production target for green hydrogen and its requirements: India has set a production target of five million tonnes of green hydrogen by 2030, surpassing that of any other single economy. This target would create a demand for 100-125 GW of renewable energy, 60-100 GW of electrolysers, and an investment opportunity of ₹8 lakh crore, while reducing annual emissions by 50 MMT.
• India’s advantage as a cost-effective green hydrogen producer: India’s abundance of sunshine and wind energy resources position it well to become one of the world’s most cost-effective green hydrogen producers.

Five Priorities(5Ps): For the vision to convert into reality

1. Domestic demand is critical: If we are not a big player domestically, we cannot be a major player in the international market. The mission introduces a Strategic Interventions for Green Hydrogen Transition (SIGHT) fund for five years, with ₹13,000 crore as direct support to consume green hydrogen. This will encourage heavy industries to increase demand, offering economies of scale by which suppliers can reduce prices.
2. India can be an attractive destination for domestic and foreign investment: Green hydrogen production projects announced/underway in India are far fewer compared to others. Green hydrogen is difficult and expensive to transport. The mission envisions green hydrogen hubs to consolidate production, end use and exports. A mission secretariat can ensure project clearance is streamlined and reduce financial risks.
3. Support and targeted funding: Currently, manufacturers are importing stacks and assembling them. We must become more competitive with targeted public funding in manufacturing the most critical and high-value components of electrolysers in India.
4. Establish bilateral partnerships to develop resilient supply chains: Globally, about 63 bilateral partnerships have emerged; Germany, South Korea and Japan have the most. Using yen- or euro-denominated loans for sales to Japan or to the EU, respectively, could reduce the cost of capital and help us become export competitive. India must cooperate with like-minded countries on trade, value chains, research and development, and standards
5. Coordinate with major economies to develop rules for a global green hydrogen economy: In the absence of common global frameworks, attempts for rules and standards are being driven by collectives of private corporations rather than through structured intergovernmental processes. There are already signs of conflicting regulations and protectionist measures in major markets. These put India’s ambitions at risk.

What is Green Steel?

• Green steel refers to steel that is produced using sustainable and environmentally friendly methods.
• Green steel, is produced using renewable energy sources, such as wind and solar power, and by utilizing low-emission technologies that reduce carbon emissions.
• One of the main ways to produce green steel is through the use of hydrogen instead of coal or natural gas as the reducing agent in the steel-making process.
• Green steel is seen as a way to reduce the environmental impact of the steel industry, which is responsible for a significant portion of global carbon emissions.
• Costs of green steel, made from green hydrogen, are currently much higher, but could be reduced with economies of scale and changes in production technologies

Conclusion

• India’s G20 presidency is an opportunity to craft rules for a global green hydrogen economy. These rules must address operational threats, industrial competitiveness and strategic threats. India should promote a global network on green hydrogen via which companies could collaborate. Green hydrogen will be a critical industrial fuel of the 21st century. India is well-positioned to show leadership in our collective interest and that of the planet.

Mains Question

Q. What is National Green Hydrogen Mission launched by the government of India? Discuss the key priorities of the mission that will they help India achieve its ambitious production target.

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