The panorama of India’s vitality sector is present process a transformative shift because the nation embraces the potential of inexperienced hydrogen. Inexperienced hydrogen is vital for assembly India’s vitality safety wants whereas lowering emissions in hard-to-abate sectors. Recognising this, the Indian authorities launched the Nationwide Inexperienced Hydrogen Mission in early 2022. The intention is to spur inexperienced hydrogen manufacturing and consumption via roughly $2.3 billion in incentive funding, to be distributed between 2022 and 2030. Not too long ago, the sector witnessed key public sale outcomes and coverage bulletins by the federal government. On this article, Renewable Watch gives key particulars of those developments…
Public sale for inexperienced hydrogen manufacturing
The tenders for inexperienced hydrogen manufacturing have been issued in July 2023 underneath the Ministry of New and Renewable Vitality’s (MNRE) Tranche-I of the Strategic Interventions for Inexperienced Hydrogen Transition (SIGHT) programme. The tenders sought proposals for each the know-how agnostic pathways bucket (Bucket I) and the biomass-based pathways bucket (Bucket II). Bucket I accounts for 410,000 metric tonnes each year of inexperienced hydrogen capability, whereas Bucket II holds 40,000 metric tonnes each year. In accordance with SECI, bids for a complete of 553,730 tonnes per 12 months have been made by the builders.
Inside Bucket I, Reliance, Greenko, and ACME secured 90,000 metric tonnes of capability every, with common incentives of Rs 18.9 per kg, Rs 30 per kg, and Rs 30 per kg, respectively. Hygenco secured 75,000 metric tonnes of capability with a median incentive of Rs 25.04 per kg. Amongst different profitable bidders have been Welspun New Vitality (Welspun), which obtained 20,000 metric tonnes at a median incentive of Rs 20 per kg, Torrent Energy with 18,000 metric tonnes awarded at Rs 28.89 per kg, Calcutta Electrical Provide Company (CESC) Initiatives gaining 10,500 metric tonnes, and UPL (previously United Phosphorus Restricted) acquiring 10,000 metric tonnes of capability with no common incentive. JSW Neo Vitality (JSW Vitality) gained 6,500 metric tonnes of capability from the quoted 10,000 metric tonnes at a median incentive of Rs 34.66 per kg underneath the bucket filling methodology.
Bharat Petroleum Company Restricted secured 2,000 metric tonnes of inexperienced hydrogen manufacturing capability underneath Bucket II with a median incentive value of Rs 30 per kg. This firm was the only winner on this class, leaving 38,000 metric tonnes of capability unallocated.
Public sale for electrolyser manufacturing
Other than the inexperienced hydrogen manufacturing tender, SECI additionally issued a young for 1,500 MW of electrolyser manufacturing capacities throughout India. Reliance Electrolyser Manufacturing (Reliance), John Cockerill Inexperienced Hydrogen Options, Jindal India, and Adani New Industries have been awarded contracts. These capacities will probably be developed underneath the MNRE’s Tranche I of the SIGHT programme. The tender, which was issued in July 2023, invited proposals in two classes.
Below Bucket I, Reliance, John Cockerill, and Jindal India secured 300 MW per 12 months capability, every with a most incentive allocation of Rs 4.44 billion. Different profitable bidders included Ohmium Operations, which obtained 137 MW each year with a most incentive allocation of Rs 2.03 billion, and Advait Infratech (a consortium with Rajesh Energy Service), successful 100 MW with an incentive allocation of Rs 1.48 billion. L&T Electrolysers secured 63 MW out of the entire 300 MW each year capability quoted, with an incentive allocation of Rs 932.4 million. The whole bids acquired for Bucket I amounted to 2,842 MW each year.
Below Bucket II, HomiHydrogen secured 101.5 MW each year capability with an incentive allocation of Rs 1.5 billion, whereas Adani New Industries secured 198.5 MW each year capability with an incentive allocation of Rs 2.94 billion. Adani had proposed a 300 MW each year capability. The whole bids acquired for Bucket II amounted to 486 MW each year. Moreover, the bottom incentive for each buckets will begin at Rs 4,440 per kW within the first 12 months and steadily lower to Rs 3,700 per kW within the second 12 months, Rs 2,960 per kW within the third 12 months, Rs 2,220 per kW within the fourth 12 months, and Rs 1,480 per kW within the fifth 12 months.
Tips for implementation of pilot initiatives within the mobility, metal and transport sectors
These three separate tips have been issued by the MNRE in February 2024 as a part of the Nationwide Inexperienced Hydrogen Mission.
Below the “Scheme Tips for Implementation of Pilot Initiatives to be used of Inexperienced Hydrogen within the Transport Sector”, the MNRE will execute pilot initiatives aimed toward changing fossil fuels within the transport sector with inexperienced hydrogen and its derivatives. These initiatives will probably be executed via the Ministry of Street Transport and Highways and the Scheme Implementing Companies (SIAs) designated underneath this initiative. The scheme will facilitate the development of applied sciences for utilising inexperienced hydrogen as a gasoline in buses, vehicles, and four-wheelers, utilising each gasoline cell-based and inner combustion engine-based propulsion applied sciences. Moreover, the scheme will concentrate on creating infrastructure, comparable to hydrogen refuelling stations. The scheme will probably be carried out with a complete funds allocation of Rs 4.96 billion till the monetary 12 months 2025-26.
With a complete budgetary outlay of Rs 4.55 billion till the monetary 12 months 2029-30, “Scheme Tips for Implementation of Pilot Initiatives for the Use of Inexperienced Hydrogen within the Metal Sector underneath the Nationwide Inexperienced Hydrogen Mission,” intention to interchange fossil fuels and fossil fuel-based feedstock with inexperienced hydrogen and its derivatives within the metal trade. The MNRE will oversee pilot initiatives in collaboration with the Ministry of Metal and designated Implementing Companies.
The federal government has additionally unveiled pilot venture tips centered on lowering carbon emissions within the transport trade via the utilisation of inexperienced hydrogen as a part of the Nationwide Inexperienced Hydrogen Mission. The initiative seeks to facilitate the usage of inexperienced hydrogen and its by-products as a supply of gasoline for ship propulsion whereas additionally engaged on the institution of bunkering and refuelling amenities at ports. The programme is allotted a funds of Rs 1.15 billion till the fiscal 12 months 2025-26. The execution of the pilot initiatives will probably be carried out by the Ministry of Ports, Transport, and Waterways (MoPSW) and designated executing businesses.
The programme consists of two components. As part of Part A, present ocean-going and inland waterways vessels will endure retrofitting to include inexperienced methanol, inexperienced ammonia, or hydrogen gasoline cell-based propulsion methods, at an estimated price of Rs 800 million. By 2027, the Transport Company of India is dedicated to retrofitting a minimal of two ships. At a price of about Rs 350 million, Part B entails constructing bunkering and refuelling amenities for inexperienced hydrogen-based fuels at one port alongside a world transport route by 2025.
Incentives for manufacturing of inexperienced hydrogen and inexperienced ammonia
The MNRE has launched incentive implementation frameworks to encourage the annual manufacturing of 200,000 MT of inexperienced hydrogen and 550,000 MT of inexperienced ammonia. The incentives for producing and delivering cost-effective inexperienced hydrogen to refineries via a aggressive choice course of fall underneath Mode 2B of the SIGHT initiative and people for producing inexperienced ammonia fall inside mode 2A. The incentives will probably be awarded for a length of three years. The whole funds for the inexperienced hydrogen and its derivatives manufacturing incentive scheme throughout all modes quantities to Rs 130.5 billion. For inexperienced hydrogen, through the preliminary 12 months, the motivation stands at Rs 50 per kg, adopted by Rs 40 per kg within the second 12 months, and additional decreased to Rs 30 per kg within the third 12 months. In the meantime, for inexperienced ammonia, through the preliminary 12 months, the motivation stands at Rs 8.82 per kg, adopted by Rs 7.06 per kg within the second 12 months, and additional decreased to Rs 5.30 per kg within the third 12 months.
The best way ahead
Each the SECI tenders for inexperienced hydrogen manufacturing and electrolyser manufacturing have been oversubscribed, which highlights the keenness of the trade. In accordance with SECI, the inexperienced hydrogen public sale was restricted to a manufacturing capability of 450,000 tonnes per 12 months. Nevertheless, bids have been made for a complete of 553,730 tonnes per 12 months. Quite a few present and new gamers within the inexperienced hydrogen sector, each from India and abroad, made numerous venture commitments associated to inexperienced hydrogen manufacturing and electrolyser manufacturing.
Nevertheless, the excessive price of inexperienced hydrogen manufacturing continues to be a major concern. This price is anticipated to be offset by incentives and low tariffs witnessed for renewable vitality initiatives, particularly for photo voltaic. In accordance with the World Financial Discussion board, inexperienced hydrogen prices want to return right down to a benchmark purpose of $2 per kg for a inexperienced vitality ecosystem to develop in India, thereby attaining cost-parity with gray hydrogen and paving the best way for widespread adoption. Electrolyser prices account for roughly 30–50 per cent of complete inexperienced hydrogen manufacturing prices in India. Electrolyser prices will also be decreased considerably with scale and innovation.
Other than incentives, the notification of the inexperienced hydrogen commonplace brings readability to the inexperienced hydrogen neighborhood in India and was extensively awaited. With this notification, India turns into one of many first few nations on the earth to announce a definition of inexperienced hydrogen. To advertise demand, industries could also be mandated to devour a sure proportion of inexperienced hydrogen.
All in all, the oversubscribed auctions, announcement of incentives and floating of tips for pilot initiatives in metal, transport and transportation sector is a giant optimistic for the inexperienced hydrogen trade in India.
By Anusshka Duggal
