The Union Cabinet has approved National Green Hydrogen Mission on January 4, 2023. The mission has an initial budget outlay of Rs 197.44 billion. This comprises of an outlay of Rs 174.99 billion for the Strategic Interventions for Green Hydrogen Transition Programme (SIGHT) programme, Rs 14.66 billion for pilot projects, Rs 400 million for R&D, and Rs 388 million towards other components. Industry experts share their views…
Girishkumar Kadam, Senior Vice President & Co-Group Head – Corporate Ratings, ICRA Limited
The notification of the National Green Hydrogen Mission for green hydrogen by the Government of India (GoI) on 4th January 2023 is a positive step, which reinforces the GoI’s strong policy push towards renewable energy (RE) & attaining the long-term path of net zero energy. While the investment prospects are strong to meet 5 MMT of Green Hydrogen requirements as per the Mission by 2030, the cost competitiveness of Green Hydrogen would remain contingent upon the extent of the reduction in capital cost of electrolyser and competitiveness of RE procurement. Further, round-the-clock (RTC) procurement of RE at cost-competitive rate remains extremely critical for an improvement in the utilisation of electrolyser. On the policy front, key measures pertaining to the green hydrogen purchase obligation norms, as well as the timely implementation of the proposed production-linked incentive (PLI) scheme to incentivize / promote the domestic manufacturing of electrolysers will be critical.
Arun Kumar, Partner – Energy & Infrastructure, Induslaw
The Cabinet’s approval of the NHGM and the financial outlay & incentives for the SIGHT program is an expected & welcome next step in India’s plans for energy transition, decarbonisation, and to become a global hub for production of green hydrogen. The financial support from Government will generate increased interest and investment from the private sector and help in making this presently expensive sector more viable. Having said that, the industry will now look forward to the introduction of a robust and enabling regulatory framework for the green hydrogen sector.
Gautam Mohanka, Managing Director, Gautam Solar Private Limited
We genuinely welcome the Government of India’s much-awaited initial outlay for ‘National Green Hydrogen Mission’. India’s dependency on fossil fuels has been a matter of concern, given that our power consumption demands are likely to soar massively over the next twenty years.
The initial outlay of Rs. 19,744 crores will boost the production of green hydrogen in India and will eventually help the industrial, commercial, and residential sectors alike. Given that we currently import more than 80% of our national oil requirements, green hydrogen along with solar and wind could be the answer to the future, with this initial outlay being projected to curtail fossil fuel imports of over Rs. 1 Trillion by the year 2050. Of these Rs. 19,744 crores, Rs. 17,490 crores is allocated for the SIGHT programme, which will not only provide a growth opportunity to the domestic manufacturing of electrolysers but also provide a boost to the target of production of 5 million metric tonnes of Green hydrogen by 2030 and making India a green hydrogen hub. This is our international commitment as well for becoming a zero-emission nation. Hydrogen and Ammonia will help to further decrease the use of fossil fuels and is wished to be future fuels and will provide clean air to the future generation.
Green hydrogen and green ammonia is the future of our country. The production of green hydrogen can rely on electricity generated by solar plants, and in a way, this is a boost to the renewable sector. Gautam Solar looks forward to empowering local players and businesses in using solar power for green hydrogen production and usage. We hope that the government will eventually make it mandatory for select industries to use green hydrogen and solar power to reduce the reliance on fossil fuels. We also see this as a prospect for the indigenous production of power components, panels, and parts.
We have previously applauded Honorable Prime Minister Mr. Narendra Modi’s commitment at the COP27 summit, and we believe that this initial outlay for ‘National Green Hydrogen Mission’ will propel the renewable energy sector in the right direction.
Deepto Roy, Partner, Shardul Amarchand Mangaldas & Co.
The successful fashioning of Green Hydrogen infrastructure is key for India’s move towards net zero emissions, since green hydrogen has the potential to replace carbon heavy fuel in several key sectors. The outlay on the National Hydrogen Mission would also hopefully provide impetus to continued addition of renewable generation capacity which has been seeing some tailwinds in recent times.
Shubhranshu Patnaik, Energy, Resources and Industrials Partner, Deloitte India
The announcement of incentives under the National Hydrogen Mission Plan, along with the scale of likely hydrogen demand (25 MT by 2030) in the country, positions India as amongst the top 3 attractive nations globally for green hydrogen demand and production. It is a crucial policy measure in establishing India as a leader in manufacturing and production of green hydrogen. What will be required alongside this ambitious mission is to create adequate demand by transiting hard-to-abate user industries through incentives and obligations towards green hydrogen.