Prime Minster Narendra Modi put green hydrogen centre stage of India's economic policy as he claimed it can help the nation make a “quantum leap” to energy independence by 2047.
Modi prominently flagged the launch of a National Hydrogen Mission in his annual Independence Day speech, citing massive expansion of H2 produced from renewables as a route to reducing historic reliance on imported fossil fuels.
“The thing that is going to help India with a quantum leap in terms of climate is the field of green hydrogen,” said Modi.
“We have to make India a global hub for green hydrogen production and export. This will not only help India to make a new progress in the field of energy self-reliance but will also become a new inspiration for clean energy transition all over the world.”
Modi’s speech was light on further details and plans for a National Hydrogen Mission were first unveiled by the Indian government earlier this year.
However, such high-profile backing from Modi is a hugely important signal designed to drive the direction of policy, and send a strong message of confidence to investors. The Prime Minister’s enthusiastic support has been a key driver of renewable energy growth in India, which is chasing a 450GW installed target for 2030 that is among the world’s most ambitious and last week passed the 100GW mark.
Recharge reported last week how plans for the first measures under the green hydrogen strategy are already under consideration, with moves to compel oil refiners and fertiliser plants to include minimum levels in their industrial processes.
In a further boost to green hydrogen, draft power market regulations published by the Indian government on Monday opened the way for procurement of renewable H2, as well as green electricity, to count towards any renewable purchase obligation (RPO) commitments faced by industrial users.
Tim Buckley, director of energy finance studies, Australasia, for the Institute for Energy Economics & Financial Analysis, said green hydrogen could be a huge value-adding opportunity for India as it pivots towards renewables and away from imported fossil fuels, which he said currently meet most of the nation’s oil and gas demand.
'Crystal clear intent'
Buckley told Recharge: “PM Modi’s announcement at this stage is light on detail, but is crystal clear in intent, underscoring the massive economic headwind the dramatic and growing fossil fuel import bill is for India.
“Fossil fuel imports have continued to grow over the last decade, and this imported inflation is undermining the currency and the current account deficit. In turn higher inflation keeps Indian interest rates many multiples of their international peers.”
Buckley added: “PM Modi has made the clear and obvious connection that improved energy security drives Indian economic resilience.”
Some analysts in India have pointed to potentially stiff competition on price for green H2 from blue hydrogen made using abated fossil fuels.
But a report earlier this year from India-based research group the Energy and Resources Institute said green H2 there can tap the advantages of high load factors from massive projects that have helped deliver some of the world’s cheapest green power, claiming renewable hydrogen costs could fall by 50% by 2030 and by then compete with the fossil variety in some applications.