Green Hydrogen Mission India: A Wealth of Investment Opportunities

India is unwaveringly dedicated to a swift energy transition, a pledge bolstered by the interventions of Hon’ble Prime Minister Shri Narendra Modi, notably at the COP Summit. During this summit, he advocated for achieving 50% of the country’s energy needs from renewable sources by 2030. 

The Green Hydrogen Mission India is imperative to meet energy transition goals. This initiative aims to fulfil 50% of the nation’s energy needs with renewables by 2030. It emphasises the pivotal role of green hydrogen adoption in achieving this objective.

Green Hydrogen: Definition  

There are quite a few types of hydrogen production depending on the raw material and the manufacturing process. Amongst them are green, grey,  turquoise and blue. Grey hydrogen is from methane that splits with CO2 steam. It also uses coal that has higher CO2 emission. 

Blue hydrogen is also not eco-friendly and “green”. But “green hydrogen”from the Green Hydrogen Mission India uses electricity generated from the electrolysis process instead of the SMR process. Also, the electricity is from renewable resources. 

On the occasion of the 75th Independence Day, the National Hydrogen Mission presented a thorough strategy to build a sustainable Green Hydrogen Mission Indian economy. The goal is to position India as a central hub for the production and export of green hydrogen.

National Hydrogen Mission  

The Green Hydrogen Mission India necessitates a total investment of US$ 97.62 billion (Rs 8 lakh crore), with the expectation of creating 600,000 jobs. Furthermore, it might lead to a cumulative reduction of over US$ 12.20 billion (Rs 1 lakh crore) in fossil fuel imports. Not just that there might be a yearly decrease of nearly 50 MT in greenhouse gas emissions.

The Mission originally had an allocation at US$ 2.4 billion (Rs 19,744 crores). This amount encompasses US$ 2.1 billion (Rs 17,490 crores) reserved for the Strategic Interventions for Green Hydrogen Transition Program (SIGHT). 

Other than this, there are also pilot projects which have an aid of US$ 178.9 million (Rs 1,466 crores). Bulk investment of US$ 48.8 million (Rs 400 crores) for Research and Development (R&D) aims to promote green energy research and use. 

The Ministry of New and Renewable Energy (MNRE) is responsible for formulating guidelines for the national green hydrogen mission’s implementation across its various components.

Importance of Green Hydrogen Industry Under the National Green Hydrogen Mission

India imports over 40% of its primary energy requirements from abroad which costs up to USD 90 billion annually. Multiple major sectors like mobility and industrial production heavily depend on imported fossil fuels. But what if there was an alternative? Hydrogen is the answer.

Green Hydrogen Mission India facilitates the production of green hydrogen using renewable energy. It plays a vital role in low-carbon and self-reliant economic pathways. This has encouraged the use of this green fuel in many activities across the country. Find them out below.

Green Hydrogen Industry Activities and Growth 

For instance, green mobility, green farming, green buildings, equipment and policies for efficient use of this energy means economic sectors will see a growth in demand for Green Hydrogen Mission India’s policies. Here are some of the targets under this policy:

• Oil refineries will replace 30% of fuel with green hydrogen by 2035, starting from 3% in 2025.
• Fertiliser production will switch to using 70% Green hydrogen by 2035, starting from 15% in 2025.
• By 2035, urban gas distribution networks will replace 15% of their fuel requirement with green hydrogen. They will start with a 5% shift rate from 2025.

The Petroleum and Natural Gas Regulatory Board as the Green Hydrogen Mission India has granted approval for a 5% blending rate of green hydrogen with piped natural gas (PNG). The demand for hydrogen, which stood at approximately 87 million metric tons (MT) in 2020,might escalate to a range of 500–680 million MT by the year 2050. 

To carry out all these changes, there needs to be a bankable green hydrogen project. But how to build this project? What is the process by which the governments and the other parties can ensure a successful hydrogen project? Find out below. 

How to Structure a Bankable Green Hydrogen Mission Indian Project 

Given that there is an increased demand, the scale of input energy required (22,000 TWh) of green electricity to produce 500 million tonnes of green hydrogen for the Green Hydrogen Mission India project must attract investments.   

However, only a few green hydrogen projects have seen success in the market. As per PricewaterhouseCoopers (PWC), most of these projects under construction and in operation are at the pre-commercial phase with limited electrolyzer capacity; i.e. less than 50 MW. 

Proposed green hydrogen plants, even those with capacities over 100 MW, are still small compared to traditional fossil fuel alternatives. These projects face challenges like unfamiliar technology, divided energy processes, and uncertainties in production, storage, and transportation. 

Financial Feasibility and Integration Strategies 

To make hydrogen projects financially feasible, Green Hydrogen Mission India suggests combining public and private funds, but certain considerations are necessary. It plays a crucial role in creating policies that encourage investments, especially in emerging markets.  

With the hydrogen projects, investors have a whole new avenue of “green investment”. Suich eco-friendly and environmentally-conscious investments in projects for production of green hydrogen have dual benefits. Not only do you enhance your investment portfolio but also support the use and accessibility of “green energy”.

Investment Opportunities

Production and Infrastructure

Investing in green hydrogen companies India is a lucrative opportunity. This includes investing in electrolysers, renewable energy projects, hydrogen storage and transportation infrastructure, and hydrogen refuelling stations. 

Such investments when made with the help of a portfolio manager, allows you to enhance your portfolio while ensuring a high ROI.  The Green Hydrogen Mission India plays a significant role in facilitating investment in green energy assets through various strategic initiatives. 

Firstly, the mission provides a clear and comprehensive roadmap, outlining the government’s commitment to green hydrogen production and its potential as a sustainable energy source. This clarity instils confidence among investors, reducing uncertainty. It enhances investors to grow their portfolio by catalysing investments in green energy assets.

Project Development and Partnerships

Oil India Limited (OIL), a Government of India enterprise, has marked a significant milestone by commissioning the first green hydrogen plant in India, boasting a daily capacity of 10 kilograms. 

Concurrently, the ACME Group, a prominent Indian renewable energy firm, is set to inject a substantial investment of $3.3 billion into a green hydrogen and ammonia project at an industrial park co-developed with Tata Steel. This strategic move positions India at the forefront of green hydrogen innovation and sustainable energy initiatives.

FAQs:Green Hydrogen Mission India: A Wealth of Investment Opportunities

What are the key drivers for investing in the Green Hydrogen Mission in India?

Energy security, carbon neutrality, economic growth, job creation, and sustainable development propel India’s Green Hydrogen Mission for a cleaner, greener future.

How can investors navigate the regulatory landscape for green hydrogen projects?

Investors in green hydrogen projects should conduct thorough regulatory due diligence, engage with government bodies, stay informed on policy changes, and collaborate with industry stakeholders to navigate evolving regulations, ensuring compliance and optimising investment strategies.

Are there specific financial incentives for green hydrogen investments in India?

India has an approval for an incentive plan that is worth $2.11 billion or 174.9 billion rupees in a bid to cut emissions. It also aims to become a major exporter in this field. This incentive is valid for three years from the commencement of the production. 

How can individual investors contribute to and benefit from the Green Hydrogen Mission?

Individual investors can support the Green Hydrogen Mission by investing in renewable energy projects, hydrogen-related stocks, or green bonds with Sustvest .  Apart from meeting sustainable goals it helps in financial growth. 

How to invest in renewable energy projects?

You can invest in renewable energy projects with Sustvest. Grow your wealth by investing in solar projects. Help in the creation of sustainable solutions that generate great profit in return while also helping the community and environment at large.

Conclusion

There is a commitment to a rapid energy transition, as exemplified by the Green Hydrogen Mission India. This strategic initiative not only aims to achieve 50% renewable energy consumption by 2030 but also positions India as a global green hydrogen hub. 

The National Hydrogen Mission’s comprehensive plan, backed by significant investment, job creation, and emissions reduction targets, underscores the nation’s dedication to sustainable, self-reliant economic growth. Investors with the help and expertise of Sustvest  can leverage this momentum through strategic green investments, contributing to both environmental goals and financial prosperity.