The government has unveiled pilot projects guidelines focused on reducing carbon emissions in the shipping industry through the utilisation of green hydrogen as part of the National Green Hydrogen Mission. The initiative seeks to facilitate the use of green hydrogen and its by-products as a source of fuel for ship propulsion, while also working on the establishment of bunkering and refueling facilities at ports. The programme is allocated a budget of Rs 1.15 billion until the fiscal year 2025-26. The execution of the pilot projects will be carried out by the Ministry of Ports, Shipping, and Waterways (MoPSW) and designated executing agencies.
The programme comprises of two parts. As a part of Component A, current ocean-going and inland waterways vessels will undergo retrofitting to incorporate green methanol, green ammonia, or hydrogen fuel cell-based propulsion systems, at an estimated cost of Rs 800 million. By 2027, the Shipping Corporation of India is committed to retrofitting a minimum of two ships. At a cost of about Rs 350 million, Component B entails building bunkering and refueling facilities for green hydrogen-based fuels at one port along an international shipping route by 2025. The identification of the port will be carried out by MoPSW.
The programme will solely support the capital costs incurred for retrofits and the development of bunkering and refueling facilities at ports. Expenditures related to the production of green hydrogen or land will not receive funding. The central financial assistance will be distributed in three phases: 20 per cent upon the issuance of the letter of award, 70 per cent based on project milestones, and the remaining 10 per cent upon completion. The goal of the pilot projects is to verify that using green hydrogen in shipping is both technically and financially feasible. They will contribute to the evaluation of the safety, infrastructure, operational concerns, and legal requirements necessary for scaling up installation. The designated executing agencies for the projects will subsequently communicate the results of the pilot initiatives to distribute insights, best practices, and lessons acquired. The scheme will be overseen by a steering committee under the MoPSW and Ministry of New and Renewable Energy, and projects will be evaluated and chosen in a transparent manner.
