The union government is likely to release the second part of the green hydrogen policy in December this year, senior officials in the ministry of new and renewable energy (MNRE) said on October 11. The second part is expected to detail the economic benefits of manufacturing it.
The Ministry of Power notified the first part of the National Hydrogen Mission policy on green hydrogen and green ammonia on February 17. The second phase was under consideration by the central government’s expenditure finance committee at the time and the ministry has said it will be announced soon.
“Now the second phase or rather a comprehensive green hydrogen policy is in the final stages. It is yet to be tabled before the Cabinet though. Once it is approved by the Cabinet, the document will be notified. But, it will in fact be released in the form of one comprehensive policy document outlining India’s green hydrogen mission,” said AK Tripathi, advisor, MNRE.
Green hydrogen is produced using renewable energy through electrolysis. In the first part of the policy, the ministry waived the power transmission charges for 25 years for these units, allowed them to buy renewable power from exchanges or their own unit, and allowed these companies to bank unconsumed renewable power for up to 30 days with power distribution companies (discom). These companies will be provided open access within 15 days of application.
Finance minister Nirmala Sitharaman first revealed India’s plan to harness green hydrogen in her 2021 budget speech. Later, Prime Minister Narendra Modi announced the National Hydrogen Energy Mission in his Independence Day speech in August 2021.
The second part of the policy is likely to mandate energy-guzzling industries– like refineries, fertiliser, among others–to use green hydrogen and green ammonia in a phased manner and also offer production-linked incentives.
Reliance Industries Ltd has already stated that it aims to transition to green hydrogen production, from grey now, by 2025. The Adani Group also recently announced that it has entered into a partnership with TotalEnergies of France to develop a green hydrogen ecosystem.
“It’s no secret that India has been terrific in creating a green economy. We have created a strong foundation across different sectors to really grow the sector. We have about 12% of renewable energy in the grid so far and we have a long way to go. The target is to get this number to 30% by 2030, so there is a lot of room for growth there,” said Sumant Sinha, President of ASSOCHAM and Chairman and CEO of Renew Power.
Sinha said that using green energy for the non-electricity value chain is yet another opportunity.
“There is also the opportunity to create an economy that goes beyond the domestic economy and positions India as a significant exporter as the world is increasingly looking for a non-China supply chain option. The government must react competitively in terms of its hydrogen policy like other countries have. It will have to monitor and tweak the policy from time to time depending on the situation,” Sinha said while talking on the sidelines of Assocham’s ongoing International Energy Summit.
Disclosure: Moneycontrol is a part of the Network18 group. Network18 is controlled by Independent Media Trust, of which Reliance Industries is the sole beneficiary.
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