Huge incentives planned for green hydrogen industry

The India government is planning a $2 billion incentive programme for the green hydrogen industry, in a bid to cut emissions and become a major export player in the field.

The 180-billion-rupee ($2.2 billion) incentive aims to reduce the production cost of green hydrogen by a fifth over the next five years. It would do this in part by increasing the scale of the industry. The current cost in India is 300 rupees to 400 rupees per kg.

The incentive for making green hydrogen is likely to be 50 rupees per kg for three years.

The United States and the European Union have already approved incentives worth billions of dollars for green hydrogen projects.

Hydrogen can be used as a fuel. It is made by splitting water with an electrical process, electrolysis. If the devices that do that, electrolysers, are powered by renewable energy, the product is called green hydrogen, a fuel free of greenhouse emissions.

The Indian aid could be announced in the Feb. 1 budget for the fiscal year beginning April 1, said the government official.

Indian companies such as Reliance Industries, Indian Oil, NTPC, Adani Enterprises, JSW Energy and Acme Solar have big plans on green hydrogen.

Adani, led by the world’s third-richest person, Gautam Adani, said in June that it and France’s TotalEnergies would jointly create the “world’s largest green hydrogen ecosystem”.

The Indian government expects industry to invest 8 trillion rupees in green hydrogen and its derivative green ammonia by 2030, said the industry manager and another government official. Green ammonia is made by combining nitrogen with hydrogen using renewable energy sources; it can be used by the fertiliser industry or as a fuel or convenient means of transporting hydrogen.

The green hydrogen proposal is likely to be called “Strategic Intervention for Green Hydrogen Transition (SIGHT)” and will be split into 45 billion rupees for electrolyser manufacturing for five years and the 135 billion rupees for green hydrogen and green ammonia production for three years.