By Bragadesh Damodaran, Vice President and Industry Platform Leader, Energy Transition & Utilities –
India, Capgemini
Green hydrogen is a catalyst for India’s transition to a low-carbon economy. It offers a sustainable energy solution that harnesses renewable sources to decarbonise industries and reduce reliance on fossil fuels. This clean energy carrier has the potential to significantly decrease imports of fossil fuels and support India in achieving its climate goals. With a robust and evolving electricity grid infrastructure, India is well positioned to provide reliable and steady power necessary for green hydrogen production. This fuel is crucial in enhancing energy security while addressing emissions in hard-to-abate sectors such as energy, steel, cement and mobility, becoming a cornerstone of India’s sustainable energy future.
Key opportunities
India has a significant opportunity to lead the world in green hydrogen by meeting its power demand, exporting the fuel globally and positioning itself as a critical player in the international green energy landscape. The launch of the National Green Hydrogen Mission in 2023 marks a significant step towards this goal, highlighting the government’s commitment to fostering an ecosystem for producing, utilising and exporting green hydrogen. Several factors work in India’s favour, including abundant and affordable renewable energy resources, public sector backing, a stable grid infrastructure, and extensive coastline and port facilities, enabling green hydrogen production and distribution logistics. Additionally, the country’s robust engineering, procurement and construction capabilities are vital for efficiently scaling up green hydrogen projects.
The economic potential of green hydrogen is immense, as it promises job creation and substantial investments. By capitalising on these opportunities, India will improve its energy security and further its self-reliance goals. This approach will ultimately contribute to sustainable economic growth and environmental stewardship, positioning India at the forefront of the global green hydrogen revolution.
Various states in the country, including Maharashtra, Uttar Pradesh, Madhya Pradesh, Kerala, Odisha, Andhra Pradesh and Tamil Nadu, are proactively developing policies to incentivise the adoption of green hydrogen technologies. This concerted effort reinforces India’s dedication to becoming a global leader in green energy and aligns with its broader
economic objectives.
The private sector in India is a crucial driver of the green hydrogen agenda. Leveraging its resources, expertise and innovation, major companies such as Indian Oil Corporation Limited (IOCL) and Reliance Industries Limited (RIL) are investing significantly in green hydrogen projects and technologies. IOCL, for instance, plans to set up a green hydrogen facility at its refineries and is exploring partnerships to develop hydrogen fuel cell technologies, aiming to produce 3 million tonnes of green hydrogen annually by 2030. RIL plans to invest $10 billion in renewable energy projects over the next three years, with a major focus on developing green hydrogen technology. The company envisions establishing one of the world’s most extensive green hydrogen facilities at its Jamnagar refinery, integrating hydrogen production with its existing renewable energy capabilities. These efforts by private sector companies enhance technological innovation and mobilise significant investments while driving down costs.
Emerging technologies in production
Technology, particularly digital solutions, can transform the entire value chain of green hydrogen production. Artificial intelligence (AI) and internet of things (IoT) play a crucial role in optimising the efficiency and cost-effectiveness of green hydrogen production. Digital twins create virtual replicas of physical production systems, enabling engineers to simulate various scenarios and optimise the design and operation of hydrogen facilities. These technologies enable real-time monitoring, predictive maintenance and resource management, thereby facilitating smarter energy usage, improving safety through intelligent sensors, and allowing modelling and simulation of production systems. This interconnected approach ultimately drives the scalability and sustainability of hydrogen as a clean energy source in the transition towards a low-carbon economy.
Advanced analytics and cloud computing can process and interpret vast amounts of data generated during hydrogen production. These technologies allow sophisticated data analysis, leading to insights that optimise energy management and production efficiency. For example, advanced analytics can align green hydrogen production with the availability of renewable energy sources, ensuring that operations are both cost-effective and sustainable. Additionally, cloud platforms facilitate data integration across the supply chain, enhancing stakeholder collaboration and streamlining operations in production, storage and distribution networks. Cloud platforms also handle large volumes of data generated by sensors, IoT devices and production systems, enabling advanced analytics and AI-driven optimisations. This reduces operational costs and fosters innovation, making digital technologies essential for scalability.
As global emphasis on decarbonisation intensifies, research and development (R&D) efforts are needed to target advanced electrolysis technologies, such as proton exchange membranes and solid oxide electrolysers, and improve efficiency and scalability. Innovations in catalysts, including developing cheaper and more abundant materials, will be
crucial for making hydrogen production economically viable.
Besides production, R&D in green hydrogen will focus heavily on advancing storage and transportation solutions, both of which are critical for overcoming the challenges posed by hydrogen’s low energy density and high volatility. In India, the ability to store and transport hydrogen safely and efficiently is key to scaling up the hydrogen economy, given the country’s vast geography and industrial needs. Research into advanced materials for safe storage will facilitate more efficient distribution and utilisation. Collaboration between governments, industry and academia will further drive innovations and breakthroughs.
Navigating the future
Innovative solutions and supportive policies are essential for accelerating the development of India’s robust and internationally competitive green hydrogen ecosystem. A critical factor in this transition is demand creation – project developers and investors must secure long-term offtake contracts to ensure the bankability of initial projects. This will stabilise revenue streams and foster investor confidence, which is crucial until green hydrogen and its derivatives become widely traded commodities. Establishing clear policies and frameworks that promote demand for green hydrogen in various sectors, such as transportation, industrial applications and energy generation, will further catalyse market growth and attract significant investments.
In addition to regulations and market design, cost challenges must be addressed to enable the transition from grey hydrogen to green hydrogen. According to the International Renewable Energy Agency, green hydrogen production currently costs $4-$6 per kg, two to three times more than grey hydrogen. The largest single cost driver is renewable electricity, which is becoming cheaper every year. However, electricity alone should not be considered. Electrolysers, which split water into hydrogen and oxygen, must be scaled up and improved to make green hydrogen cost-competitive. This could bring green hydrogen costs below the $2 per kg mark before 2030. Additionally, developing competitive financing packages that provide economic incentives, subsidies and favourable loan terms will empower the industry to meet its capital requirements and enable competitive pricing in the global market.
Forward-looking solutions are emerging to address the challenges of storage. For instance, advancements in material are enabling the safe and efficient storage of hydrogen at lower pressures or in chemical forms, such as metal hydrides or liquid organic hydrogen carriers. These materials can help reduce the burden of infrastructure and ensure safety. In addition, innovations in green hydrogen compression and liquefaction technologies are improving transportation economics, making moving hydrogen over long distances more feasible. On the infrastructure front, investment in dedicated hydrogen pipelines and integration with existing gas networks is gaining traction, with efforts focused on retrofitting current systems for dual use. Collaboration among governments, industry and research institutions is also critical for creating regulatory frameworks and financial incentives that encourage investments in hydrogen infrastructure. An innovative and collaborative approach can propel the transition to a hydrogen-based economy and make it more viable and sustainable.
As with any emerging industry, start-ups play a vital role as they bring fresh ideas, agility and capabilities to the table. In India, start-ups are supporting the formation of a green energy ecosystem, driving innovation, scalability and localised solutions to address the country’s unique energy challenges. Their willingness to experiment with new business models allows them to be the first movers, fill gaps in the market, collaborate with established players and cater to diverse customer needs. For example, homegrown brand Hygenco is set to build and run India’s first operative green hydrogen production facility to produce energy without emitting carbon dioxide. The government also recognises and encourages start-ups’ involvement in green hydrogen innovation to accelerate India’s transition towards clean energy.
The synergy among start-ups, a solid governance system, forward-thinking policies and investments in clean energy initiatives can help India achieve its ambitions of becoming a global production and export hub. The world envisions a carbon-free future, and green hydrogen promises to build this future through energy efficiency and decarbonisation. To reach this goal, stakeholders must start today by making the fuel widely affordable, especially for developing economies seeking low-cost ways to build sustainable energy systems. Overcoming the existing challenges and transitioning green hydrogen from a niche energy source to a mainstream carrier will require a “business-to-planet” mindset at every stage – from technology readiness and adoption to market penetration and sustainable economic growth.
