Green hydrogen has become a critical area of interest in India. It is being seen as a game changer in decarbonising sectors where hydrogen can be used. There are several applications of hydrogen across sectors, most notably in the petroleum refining, metals and fertiliser industries. There are also plans to use it as a fuel in the transportation sector and as a storage technology. At the 2nd edition of the Green Hydrogen in India conference organised by Renewable Watch, leading renewable energy developers discussed their views on the green hydrogen market, technology options, policy and regulatory interventions, and future plans. Edited excerpts…
Over the past few years, ACME has forayed into the hydrogen business with the announcement of a project in Rajasthan. The integrated facility will produce 1 tonne of green hydrogen and 5 tonnes of green ammonia. The company recently signed an MoU with the Government of Oman to set up green ammonia projects. The projects will produce 0.9 million tonnes (mt) of green ammonia by 2024. Our choice of Oman was driven by the fact that it has both solar and wind resources. The government was also receptive to our request and even offered several policy incentives to set up those projects, including easy approvals and environmental clearances. We are also in talks with the governments of Australia and Chile, among other countries.
ACME’s target is to produce around 10 mt of green ammonia by 2030. We are in touch with other governments and hopefully, will announce some large-scale projects soon. Solar is our core area, but, there are certain locations where wind is desirable. With solar being intermittent, there are benefits of diversifying energy sources, which is why ACME is open to diversifying its portfolio. To ramp up ammonia production, we need power stability, which is offered by combining multiple power sources.
ACME welcomes the Government of India’s steps to promote a hydrogen economy and we are working together to promote hydrogen, especially green hydrogen, as this will be the way forward. We are aware that a draft for a hydrogen mission has been put forward and it is under review by multiple ministries. Soon we also expect policies and mandates to be announced by the government to help developers. An important issue that needs to be addressed is the formulation of an export parity price, similar to that in the oil and gas sector. We also request the government to come up with a mechanism for the aggregation of land for project development. Open access is another aspect that needs to be addressed when a hydrogen policy is released.
ACME also wishes to implement a project in India similar to the one executed in Oman. The first step towards this is an enabling policy. I do not see technology being a challenge in developing hydrogen. However, taxes and high customs duties could harshly impact prices, and hence not allow it to be competitive.
Reliance plans to set up four giga-factories, which will cover the entire spectrum of renewable energy in India. The first will be an integrated solar PV module factory, the second will be an electrolyser factory for the production of green hydrogen, the third will be a fuel cell factory for converting hydrogen into mobile and stationary power, and the fourth will be an advanced energy storage battery factory. These cover all the products that will be required for a hydrogen economy.
For green hydrogen, renewable energy can be generated from solar or wind. Because these sources are intermittent, and depending on how electrolysis is done, there may be a need to add an element of storage to it.
We can divide the whole value chain between upstream, midstream and downstream. In the midstream, we need to figure out solutions for the storage and transportation of hydrogen. In the downstream, some of the applications need to be changed from the way they are structured. We say that hydrogen is the fuel of the future, but industries like steel and refineries are the prime benefiters. We need to pave the way for a system wherein hydrogen powers the transport sector. To make renewable energy available round the clock, we need to alter the electrolysis process, in either a decentralised or a centraised manner. A system improvement akin to the solar or wind market must be catalysed in the hydrogen market as well.
In 2020, we saw 200 MW of electrolysers on the ground, and by 2022, we will be able to get to a level of about 2 GW. By the time we get to 8-10 GW of electrolyser production, we may have a higher supply than demand, which could see prices coming down, showing promising signs for the hydrogen economy.
Reliance is still in the process of evaluating technologies and partnerships for hydrogen. There are no standards yet for hydrogen production. However, there were no standards for renewable energy either, so we adopted IEC standards. I am hopeful that the EU will set some standards very soon, which will be applicable in India.
Reliance aims to set up 100 GW of renewable energy capacity over the next decade and this includes a significant capacity allocated for green hydrogen production. We are evaluating both domestic and global markets for future expansion as we have set a target of achieving net zero by 2035. We are aware that it is a difficult target, but certain that hydrogen will play a key role in our journey.
Greenko has been actively engaged in developing its renewable energy portfolio. At present, it has an installed renewable capacity of 7.2 GW. The company is now primarily focusing on large pumped storage projects, which will be a key component for green hydrogen production. A 1,200 MW pumped storage project with a storage capacity of 9 hours has already been put under execution. In addition, five projects are under way in the pipeline, with three of them at the last stage of receiving clearances. The capacity of these projects ranges from 1,260 MW to 2,500 MW. All five projects are anticipated to be completed by 2025.
Greenko is keen to foray into green hydrogen, with the view that the goal of decarbonisation can only be achieved with green hydrogen. Since excess solar power is expected to be used in green hydrogen generation, grid flexibility is central to ensure that the excess load is absorbed without any disruptions. Any additional load that is not being used can be carried to distant locations where green hydrogen is being produced. Streamlining the transportation of excess availability in one area to deficit regions is, thus, vital.
At present, policies for marketability and monetisation of green hydrogen are not in place. While industries and discoms are taking integrated measures to develop hydrogen, the sector is still at the planning stage. The availability and size of electrolysers can also be expected to impact the green hydrogen mission. The transportation of hydrogen is one of the critical issues for further development. The grid will play an important role till transportation of hydrogen is developed. A storage mechanism for hydrogen and other renewables in also crucial.
Interventions needed from the government include ISTS and GST waivers, which can promote cost effectiveness and transportation through the grid to distant locations. Other incentives such as reduction in duty, grant of special status to hydrogen projects, and provision of single-window clearances for projects will also play a key role in convincing developers to venture into hydrogen. These incentives are necessary to make the environment conducive for developers to venture into the sector. Industries are also forthcoming to foray into the hydrogen segment to meet their decarbonisation goals. As a result, new demand will soon emerge in the market. The current policy framework is optimistic and encouraging. With continued progress in this regard, the marketability of hydrogen in India is expected to be well established by 2025-26.
NTPC is focusing on various segments of green hydrogen, which can be used to achieve national targets. These include green mobility, blending of natural gas for city gas distribution networks, development of green methanol and green ammonia as well as energy storage and microgrids. Carbon capture and utilisation (CCU) technologies are being used to utilise green hydrogen for making methanol. NTPC has also established two 10 tonnes per day green methanol pilot plants.
Moreover, NTPC has decided to play a significant role in Ladakh, particularly in reaching the remotest areas where the grid may not be accessible. Many regions, schools and households remain under electricity shutdown for over five months in Ladakh. The region is also unique as its electricity demand rises during winters. Round-the-clock electricity supply during all seasons is, thus, a necessity. Solar energy and battery storage are expected to be the most crucial components to achieve universal energy supply in the region. NTPC has a vision to provide energy to the common man and it aims to take the hydrogen route for the same.
The development of any new sector or technology entails certain bottlenecks, which cannot be ignored. However, finding solutions to reduce and effectively remove the challenge areas is crucial. For instance, the intermittency of solar and wind energy needs to be addressed to ensure firmness in energy supply. This will further streamline green hydrogen production. At present, policy support for CCU does not exist. This is another area that can be focused upon. There also exists a huge import dependence on methanol. Economies of scale can be achieved as the sector progresses over the coming few years.
New developments in renewable energy can be expected in the coming years, but hydrogen is the need of the hour. Green hydrogen can help energy reach the remotest areas in the country.
Developments are rapidly occurring in the hydrogen sector. For instance, the PLI scheme is now applicable to hydrogen vehicles. The government is also bringing out an enabling policy for the use of green hydrogen in green ammonia. However, there is an equal responsibility of industries and the government to promote the adoption of hydrogen. All stakeholders must come together to ensure that the necessary measures are put in place to provide a conducive environment for the development and establishment of green hydrogen in India.
Hydrogen has multiple use cases. It can be blended with natural gas at, say, 20 per cent, which appears to be the easiest use case. It can be used in the transportation sector as well as in electricity-to-electricity applications. These use cases, however, are quite expensive currently. A key challenge with hydrogen is its transportation and the high cost of electrolysers. Currently, Ayana Power is looking at the hydrogen space primarily for the utilisation of excess solar energy in areas where power evacuation is limited. Therefore, by focusing on hydrogen production, wasted energy can be converted into something useful.
Our focus is mainly on ammonia as it is easier to transport. Transportation is a key bottleneck as the company’s power sites are remote, with not many industrial clusters around them. Ideally, companies producing hydrogen should have an industrial cluster and a power plant nearby. Therefore, we are restricted to focusing on ammonia production on site and its transportation to various locations. It is the simplest thing to do in the current scenario.
The government, through the national hydrogen energy mission, is trying to increase the demand for hydrogen in the market by mandating the use of a certain percentage of green hydrogen. The issue is that the choices for electrolyser technology are limited. Alkaline-based electrolysers have been in the market for a really long time and have the highest market share. The second mainstream option is polymer electrolyte membrane (PEM)-based electrolysers. PEM-based electrolysers seem to be a better option for green hydrogen production.
Going forward, there are two things to be worried about. One, electrolysers will be utilised six to eight hours a day, requiring immediate start and stop of the system. Two, there will be variability of power with a fair amount of fluctuations within those six to eight hours. So, the electrolysers must be able to adapt to these fluctuations.
Ayana Renewable Power has signed an MoU with Greenstat Hydrogen India for the acceleration of hydrogen technology development and production of green hydrogen in India. The partnership has potential as Greenstat’s experience can support Ayana Power in the future.