National Green Hydrogen Mission-the Hope & Hype around Fuelling India’s Decarbonization Future

Introduction

India is set to become the third-largest economy in the world by 2030 and shall experience the most significant increase in energy demand globally over the next twenty years. ‘Every year India is adding a city of the size of London to its urban population.’ This rapid growth also means rapid energy consumption which makes India the third-highest CO2 emitter in the world. Still, an average household in India consumes the same amount of electricity that an average family in the United States consumes in a year. The per capita emission of India is among the lowest in the world. At COP26 India has committed to achieving ‘Net Zero emissions’ by 2070. India aims to chart a new path of development that is not carbon-intensive and has committed to meeting fifty percent of its energy requirements from renewable sources of energy by 2030.

Instead of looking at it as a burden, the transition to clean energy is a huge economic opportunity for India. Over forty percent of India’s current energy needs are imported and depend on fossil fuels. This costs India over USD 160 billion every year and makes India vulnerable to price cycles and supply chain volatility. India, therefore, has to aggressively look for low-carbon and self-reliant energy pathways. Green Hydrogen can play an enabling role in realizing this future. India has committed over two billion US dollars to its National Green Hydrogen Mission which aims to produce five million metric tons (5 MMT) of green hydrogen per annum by 2030 and abate fifty million metric tons (50 MMT) of greenhouse gases annually.

What is Green Hydrogen?

Hydrogen is the lightest element and can be produced by the method of extraction from other Hydrogen containing compounds. Based on the nature of its extraction, Hydrogen is categorized into Grey, Blue, or Green Hydrogen.

• Grey Hydrogen: Grey hydrogen is the most common form of hydrogen fuel available today, accounting for the majority of hydrogen produced globally. It is produced from fossil fuels, typically natural gas, using a process called steam methane reforming (SMR). In SMR, natural gas is combined with steam to produce hydrogen gas and carbon dioxide as a byproduct. The carbon dioxide is released into the atmosphere, resulting in greenhouse gas emissions.
• Blue Hydrogen: Blue hydrogen is a type of hydrogen fuel that is produced from natural gas, but with carbon capture and storage (CCS) technology to reduce greenhouse gas emissions. The use of CCS technology makes blue hydrogen a cleaner and more sustainable alternative to grey hydrogen.
• Green Hydrogen: Green hydrogen is a type of hydrogen fuel that is produced using renewable energy sources, such as wind or solar power, to power the electrolysis process that separates hydrogen from water. This process is often referred to as the electrolysis of water, where electricity from a renewable energy source is used to split water into its two components, hydrogen and oxygen.

As early as 1970, Lawrence W Jones, a nuclear physicist from the University of Michigan, proposed a concept in his paper titled “Toward a Liquid Hydrogen Fuel Economy”. He suggested that liquid hydrogen should be seriously considered as a feasible alternative to hydrocarbon fuel for both land and air transportation in the 21st century.

The hope of Green Hydrogen:

Green Hydrogen has the potential to play an important role in reducing greenhouse gas emissions and mitigating climate change. It is a clean and renewable energy source that produces only water vapor and heat when burned, making it an attractive option for reducing greenhouse gas emissions. Various applications of green hydrogen include:

Storing renewable energy: In this approach, excess renewable energy is used to produce hydrogen through electrolysis, which is then stored and used as fuel for power generation or other applications. This allows renewable energy to be stored in the form of hydrogen, which can be used later when the demand for energy is high, or when renewable energy production is low.

Industrial applications: Green hydrogen has the potential to play an important role in decarbonizing various industrial sectors. Some examples are-

Chemical production: Green hydrogen can be used as a feedstock to produce various chemicals, such as ammonia, methanol, and other industrial gases. For example, green hydrogen can be used in the Haber-Bosch process (accounts for 1.4% of global carbon dioxide emissions) to produce ammonia, a key ingredient in fertilizers. India annually consumes about 15 million tonnes of ammonia for fertilizer production and 15 percent of this is imported.

Steel production: Green hydrogen can be used as a reducing agent in the production of steel (accounts for around 7–9% of global greenhouse-gas emissions), substituting the use of coking coal in the traditional blast furnace process that is primarily imported. Of the 58.37 million tonnes of coking coal used by the Steel industry in 2018–19, 51.83 million tonnes were imported.

Transportation: Green hydrogen can be used as a fuel for heavy-duty vehicles, such as trucks and buses, providing a low-carbon alternative to traditional diesel fuel. Fuel cell electric vehicles (FCEVs) use hydrogen as a fuel source instead of relying on a battery to store electricity. Compared to battery electric vehicles (BEVs), FCEVs are not reliant on lithium and cobalt for lithium-ion batteries and the supply chain of the hydrogen fuel cell can be indigenized.

The hype of Green Hydrogen:

While green hydrogen is generating a lot of interest and investment due to its potential to decarbonize various sectors of the economy, it also has a notable list of disadvantages.

1. Hydrogen does not exist naturally and therefore requires energy for separation. Additionally, its storage necessitates either compression to 700 times atmospheric pressure, refrigeration to minus 253 degrees Celsius, or a combination with an organic chemical or metal hydride.
2. The production of green hydrogen is still relatively expensive which makes it less competitive in some markets. As per an International Energy Agency report from 2019, if all the hydrogen produced then were solely generated from renewable electricity, it would require an electricity demand of 3,600 TWh. That amount would be greater than the total annual electricity generation of the European Union.
3. Hydrogen has only a quarter of the energy per unit volume of natural gas, whether in a liquefied or gaseous state at any given temperature and pressure.
4. Fuel cells and other hydrogen-powered equipment have many moving parts that require maintenance. Furthermore, hydrogen can cause metal embrittlement and escape even through the tiniest leaks. Hydrogen is highly explosive.
5. Water usage: The production of green hydrogen requires a significant amount of water, which can be challenging in areas with limited water resources.
6. Green hydrogen is a relatively new technology and industry, and as such, there is still some regulatory uncertainty surrounding its production, storage, and distribution.
7. The cost of hydrogen for consumers greatly relies on various factors, such as the number of refueling stations available, their frequency of use, and the amount of hydrogen delivered per day. Addressing this issue would require careful planning and coordination among national and local governments, industry players, and investors.

Policy Recommendations:

Green hydrogen is expected to play a critical role in achieving net zero emissions and decarbonizing difficult-to-decarbonize sectors. A report prepared by NITI Aayog and Rocky Mountain Institute estimates that the demand for hydrogen in India is set to increase fourfold, which will mostly be driven by the Steel industry and heavy vehicle transportation. With the advantage of low-cost renewable energy, India has the potential to be the supplier of Green Hydrogen to the world. The right policy framework coupled with appropriate incentives would bring cutting-edge research & development, and large-scale manufacturing as well as jobs in India. It is expected that green hydrogen would produce as many as 0.6 million jobs in India by 2030. Government of India needs to make a detailed roadmap till 2050, with milestones after the end of every decade. This could be broken down further into 5-year objectives and progress monitored through a nodal agency. Steps like the Inflation Reduction Act passed by the US government can be emulated to create a supply-side intervention and reduce the price of green hydrogen. In addition to the 2 billion dollars, a global fund could be created exclusively for the purpose of R&D, promotion of start-ups, and building requisite infrastructure.

It is imperative for India to ensure that its citizens are the beneficiaries of the country’s energy transition. This can be achieved through the implementation of well-designed policies that can effectively manage any potential conflicts arising from the need for affordability, security, and sustainability.