Cabinet approves Rs. 19,700 crore outlay for Green Hydrogen

It appears like the government is moving aggressively towards a National Green Hydrogen focus with the National Green Hydrogen Mission allocating Rs. 19,744 crore with a view to producing 5 million tonnes of green hydrogen annually by the year 2030. The break up would be as under. Out of the Rs. 19,744 crore allocation, bulk of the Rs. 17,490 crore would be towards providing incentives for producing electrolysers and green hydrogen. Another Rs. 1,466 crore would be allocated to pilot projects while a sum of Rs. 400 crore is going to be allocated to research and development. The balance would be for mission components. Green Hydrogen is also eligible for benefits under Production Linked Incentive (PLI) plan.

The central government is extremely positive about this project and expects that it would attract investments worth Rs. 8 trillion by the year 2030 and also create 600,000 jobs in the process. In addition, it would also create a major hub for production, utilisation and export of green hydrogen. More than anything else, this is likely to result in reduction in carbon dioxide emission by nearly 50 million tonnes annually and in the process it will also save India Rs1 trillion in fossil fuel imports. This will be in tune with the overall target for India to become totally energy independent by the year 2047. At the same time the domestic production of green hydrogen will also give a boost to Indian exports.

Read: India plans $2.2 billion incentive program for green hydrogen

Any project of this scale and magnitude will not just be about the production and export but also the support infrastructure and the supply chains to manage the same. This is required for the initial few projects and the plan also envisages to create green hydrogen hubs. These hubs will allow supply chains to be established and scale of production to increase. The chain of raw material supply and offtake of the finished product have to be seamless, failing which the production flows cannot happen. Several nations have already come up with green hydrogen subsidies and support programmes and this plan announced by India is perfectly timed. It needs solid government support and encouragement to begin with.

Read All you want to know about National Green Hydrogen Mission