National Green Hydrogen Mission: Cabinet Approves INR 19,744 Crore; Aims to Reduce Emissions

A 19,744 Crore incentive programme to encourage the production of green hydrogen in the nation was approved on Wednesday by the Cabinet, which is led by Prime Minister Narendra Modi. The programme aims to reduce emissions.

Anurag Thakur, Minister of Information and Broadcasting, reported that the Cabinet had approved the National Green Hydrogen Mission, which is anticipated to draw investments totalling 8 lakh crore into the green hydrogen supply chain.

Incentives would help down the cost as India aspires to produce 5 million tonnes of green hydrogen annually over the next five years.

Mr. Thakur informed the media about the Cabinet choices and added, “The Union Cabinet, chaired by Prime Minister Narendra Modi, has approved the National Green Hydrogen Mission.”

The process of splitting water results in carbon-free hydrogen, which can be utilised as a fuel for cars and as an energy source in businesses like steel mills and oil refineries. Green hydrogen is created when electrolysis is used to split water using renewable energy like the sun as the power source. Such a mechanism results in the production of oxygen as well.

19,744 crore will be the initial investment for the mission, of which 17,490 crore will go toward the SIGHT programme, 1,466 crore to pilot projects, 400 crore to research and development, and 388 crore to other mission components.

The Ministry of New and Renewable Energy (MNRE) will create the guidelines for carrying out the strategy. By 2030, the goal is to help the country reach a capacity for producing green hydrogen of at least 5 MMT (million metric tonnes) per year, along with an additional 125 GW of renewable energy capacity. By 2030, it will be necessary to invest more than Rs. 8 lakh crore and create more than 6 lakh jobs.

By 2030, it will also reduce fossil fuel imports by more than 1 lakh crore rupees and reduce yearly greenhouse gas emissions by almost 50 MMT. Rajat Seksaria, CEO of ACME Group, commented on the action and said it presents a fantastic chance for India to establish itself as a major hub for the export of green hydrogen and ammonia.

He continued, “The green molecule from India is competitive due to the incentive programme. This is necessary for the first few projects and to build green hydrogen hubs, which will enable the establishment of supply chains and an increase in production size.” Green hydrogen support and subsidy schemes have already been developed by a number of countries.

The Inflation Reduction Act, recently unveiled by the US, contains a significant support programme for clean hydrogen. He noted that through governmental support programmes, Germany, the United Kingdom, and Japan are also supporting clean hydrogen.

The Mission will have many benefits, according to an official statement, including opening up export markets for green hydrogen and its derivatives, decarbonizing the industrial, mobility, and energy sectors, reducing reliance on imported fossil fuels and feedstock, enhancing domestic manufacturing capabilities, creating job opportunities, and advancing cutting-edge technologies.

The Mission will encourage the growth of green hydrogen demand, as well as the creation, consumption, and export of the fuel. Under the Mission of the Strategic Interventions for Green Hydrogen Transition(SIGHT) Programme, two unique financial incentive mechanisms will be provided, focusing on domestic electrolyser production and green hydrogen generation.

In addition, the Mission will fund pilot projects in emergent end-use industries and production paths. Green Hydrogen Hubs will be identified and established in regions capable of supporting large-scale hydrogen generation and/or utilisation, according to the minister.

An enabling policy framework will be created to assist in the development of the green hydrogen ecosystem. Additionally, a strong foundation of norms and regulations will be created.

Moreover, the Mission will support a framework for public-private R&D cooperation (Strategic Hydrogen Innovation Partnership – SHIP). R&D projects will be goal-oriented, time-bound, and adequately scaled up to develop globally competitive technology. Additionally, a coordinated skill-development programme will be put into action.

All related ministries, departments, organisations, and institutions of the federal and state governments will conduct focused and coordinated actions to ensure the Mission’s success. He indicated that the Ministry of New and Renewable Energy will be in charge of overall coordination and implementation of the Mission.

Vineet Mittal, Chairman of the Avaada Group, stated, “It will provide a much-needed boost to the green hydrogen industry. This intervention is even more noteworthy because it comes at a time when India has the G20 presidency, emphasising India’s commitment to leading the global energy transformation.” He predicted that Indian hydrogen demand will be more than fivefold to 28 MT by 2050, with enormous opportunities for exports.

This action, he believes, will assist Indian developers in meeting the demand and supplementing ongoing efforts to achieve the aim of 500 GW of renewable energy by 2030 and net zero emissions by 2070.

Deloitte India’s Energy, Resources, and Industrials Partner Shubhranshu Patnaik stated, “The announcement of incentives under the National Hydrogen Mission Plan, combined with the magnitude of likely hydrogen demand in India, positions the country as one of the few attractive nations in the world for green hydrogen demand and production. It is an important legislative step toward establishing India as a regional manufacturing and production centre for green hydrogen.”

According to Gautam Mohanka, Managing Director of Gautam Solar, given that India currently imports more than 80% of its oil requirements, green hydrogen, along with solar and wind, could be the answer to the future, with this initial investment expected to reduce fossil fuel imports by more than $1 trillion by 2050.

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National Green Hydrogen Mission: Cabinet Approves INR 19,744 Crore; Aims to Reduce Emissions