The government has identified 10 potential states that could be the key enablers in manufacturing green hydrogen in the country, said two officials aware of the development.
The states - Karnataka, Odisha, Gujarat, Rajasthan, Maharashtra, Tamil Nadu, Andhra Pradesh, Kerala, Madhya Pradesh and West Bengal - are likely to have green hydrogen or ammonia manufacturing zones or clusters, helping India kickstart its National Green Hydrogen Mission in its initial years.
“These states have been identified on the basis of the existing steel and fertiliser industries, refineries and ports located there, along with the operational and potential renewable energy generation capacity in the regions. At some locations, we have also incorporated the city gas distribution network as that is another sector that can offtake green hydrogen,” a senior official in the ministry of new and renewable energy (MNRE) said.
On November 2, the Karnataka government signed a set of agreements worth Rs 5.20 lakh crore during the inaugural day of the three-day Invest Karnataka 2022 – Global Investors Meet. Of the Rs 5.20 lakh crore, Rs 2.9 lakh crore worth investments will be in the green hydrogen and derivatives sector alone, through which the Karnataka government aims to build India’s first green hydrogen manufacturing cluster or zone.
Odisha, the largest manufacturer of steel in the country, has also decided to push for green hydrogen and green ammonia manufacturing. Green hydrogen, obtained from the splitting of water using solar and wind power, offers a cleaner alternative for producing steel. This can also help reduce the sector’s dependence on coking coal imports. The state which has some major ports and is developing new ones is also projecting itself as a green hydrogen export hub to investors.
Gujarat has reserved 6,000 square kilometres of land parcels in Banaskantha and Kutch only for hydrogen projects in the state. Tamil Nadu has approved a green hydrogen and ammonia project to be built by ACME Group at an investment of Rs 52,474 crore. The proposed project includes a 5 giga watt (GW) solar power plant, a 1.5 GW electrolyser, and 1.1 million tonne of ammonia production capacity.
First announced by Prime Minister Narendra Modi in his Independence Day speech in August 2021, the final draft of the complete national green hydrogen mission is undergoing a series of approvals and is likely to be released by December. The draft mission proposes a framework for demand creation, a basket of measures to support the indigenous production and utilisation of green hydrogen.
It also includes research and development work, pilot projects, enabling policies and regulations along with infrastructure development.
The government is expected to allocate Rs 10,000-12,000 crore worth of production-linked incentive (PLI) schemes for electrolysers and green hydrogen from the Rs 20,000-crore green hydrogen mission. However, the PLI for manufacturing green hydrogen is likely to be a limited offer.
Union Power Minister RK Singh had hinted the same on October 17 at an event. “The PLI for manufacturing green hydrogen will only be required for the initial capacities, maybe 4-5 million tonnes. After that, the green hydrogen (industry) will stand on its own feet,” he said.
The minister also touched upon the green hydrogen manufacturing capacity and informed that the industry has shown interest in 25 million tonnes of green hydrogen capacity, a number which can easily cross 35-40 million tonnes. India plans to manufacture 5 million tonnes of green hydrogen per annum by 2030.
In February, the government had released the green hydrogen policy promising to offer cheaper renewable power, fee waivers for inter-state power transmission for 25 years for projects commissioned before June 2025, land in renewable energy parks, and creating manufacturing zones for the same.
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