In a bid to make itself a green hydrogen hub, the Indian Government recently completed and made public its new green hydrogen policy. The policy will guide India’s activities towards the achievement of its climate targets. According to policy analysts, the move is a tremendous step towards the transition from fossil fuel-based energy sources towards sustainable green hydrogen power.
The new policy targets the production of whopping five million metric tonnes of green H2 annually by the year 2030. With this new development, India’s renewable energy capacity will be greatly enhanced over the next few years. The primary targets will be hydrogen and ammonia since they are the major fuels expected to replace carbon-emitting fossil fuel sources. One major impact of the new development will be a significant reduction in the importation of fossil fuel.
It is worth noting that India’s new green hydrogen policy comes at a period when countries across the world are coming up with green H2 projects day in day out. In 2021, during the COP-26 Summit in Glasgow India had pledged to ensure that it achieves zero carbon emissions by 2070. The new policy is, therefore, part of the quest to make sure that it, indeed, becomes carbon-neutral by the said year. Thankfully, there is a rapid development of technologies that are slowly, but gradually reducing the challenges associated with the production and use of green hydrogen sustainably as a perfect replacement for fossil fuel.
India’s quest to achieve energy security and reduce emissions has also recently gained relevance given the ongoing Russia-Ukraine crisis. Arguably, India is one of those feeling the immediate effects of the ongoing war since it imports, at least, 85% and 53% of oil and natural gas respectively. It’s for this reason that energy costs in India have been on the rise recently, but, of course, the effects have been felt worldwide and might get even worse if the crisis is not resolved soon.
In its new policy, India has included several notable incentives. These are the ingredients that are expected to spur growth in the energy sector and possibly attract potential investors. The policy encourages manufacturers to purchase renewable energy or set up energy capacity by themselves anywhere in the country. To create a favourable environment, the Indian government also offers to grant open access within just 15 days of making a formal application. Further, the policy permits manufacturers to bank any unused energy produced for up to 30 days. All these are expected to give manufacturers both those working and potential ones an enabling environment for thriving green hydrogen business.
India’s new policy also offers some incentives related to the distribution and consumption of sustainable renewable energy. For instance, companies that produce green hydrogen are allowed to put up bunkers in areas near the port for storage and to facilitate easy shipping. But that’s not all! Port authorities have also been permitted to allocate space to such manufacturers, of course, at competitive rates.
Generally, India’s new policy is positive step towards decarbonisation as well as helping in the attainment of energy security. However, to achieve its objectives, India has to invest continuously in hydrogen innovation, research and development activities. Most importantly, it should ensure that there are the right technologies that can help reduce the cost of producing green hydrogen.
