The year 2023 is set to become a turning point for India’s green hydrogen journey. In just seven months, the fledgling green hydrogen segment has witnessed a slew of policy interventions by the government. These are expected to improve confidence and promote private sector investments in the segment.
After the National Green Hydrogen Mission was greenlit right at the beginning of the year with a budget outlay of Rs 197,440 million, a detailed mission document was also notified. The mission targets the production of at least 5 million metric tonne (MMT) of green hydrogen per annum by 2030, with the potential to reach 10 MMT per annum.
Since then, a complete waiver of inter-state transmission charges has been announced for green hydrogen or green ammonia production units that are commissioned on or before December 31, 2030. These waivers are applicable for a period of 25 years from the date of commissioning of the project. Projects that get commissioned after December 31, 2030 will have to pay graded transmission charges thereafter.
More recently, in June 2023, two much awaited financial incentives were announced under the Strategic Interventions for Green Hydrogen Transition programme to support the domestic manufacturing of electrolysers (Component I) and the production of green hydrogen (Component II). Component I, with a budget of Rs 44.40 billion, will provide incentives in terms of Rs per kW. Meanwhile, Component II, with a total budget outlay of Rs 130.5 billion for both modes, will provide a direct incentive in terms of Rs per kg of green hydrogen production under Mode 1.
Already, a tender has been issued for 450,000 MT per annum of green hydrogen. Meanwhile, a draft roadmap has been released on the R&D requirements to support a green hydrogen ecosystem in India.
Summing up, these government initiatives are steps in the right direction to make India a global hub for green hydrogen production and export. What is required now is timely implementation along with clear regulatory frameworks.
