The policy aims to boost the production of green hydrogen in the country. Fuel can be a game-changer for India’s energy security, which imports 85% of its oil needs and 53% of its gas needs.
Addressing a conference on “India’s Leadership in Energy Transition” here, the minister said the first part of the policy to be unveiled would include elements that would be implemented immediately by the government and that the second party is currently with the Expenditure Finance Committee.
Singh said that under the policy, the government will give companies the “freedom to set up renewable energy capacity anywhere on their own or through a developer”.
mint India reported earlier that it is considering a proposal to make it mandatory for fertilizer plants and oil refineries to use green hydrogen as part of plans to reduce the country’s dependence on fossil fuels. India’s strategy is to leverage the scale of its ambitious green hydrogen plan on the likes of its renewable energy program, leading the country to run the largest clean energy program in the world.
“We will give them open access,” Singh said, adding that the government will also allow excess green hydrogen produced by any company to be banked or stored for up to 30 days, if there is capacity in place before. 2025.
Green hydrogen is produced by splitting water into hydrogen and oxygen using an electrolyzer which can be powered by electricity from renewable energy sources such as wind and solar. Hydrogen can be used for both fuel cells and internal combustion engines. It is also used for applications in sectors such as chemicals, iron, steel, transport, heating and electricity.
It comes at a time when clean energy, environmental protection and energy transition are at the center of Indian government policies, with Prime Minister Narendra Modi pledging at the COP26 summit in Glasgow last year. last to become carbon neutral by 2070.
The government would also mandate the use of green hydrogen and green ammonia under the upcoming policy in a phased manner, he said. This mandate, however, would require Cabinet approval, he added.
Indian companies including Reliance Industries Ltd, Adani Group, Greenko and Acme Solar Holdings Ltd have announced their green hydrogen plans. About 54% or 3.6 mmt of India’s annual hydrogen consumption of 6.7 mmt is used in petroleum refining and the rest in fertilizer production. However, it is “grey” hydrogen produced from fossil fuels such as natural gas or naphtha.
Noting that several countries, including Japan and Germany, are interested in supplying green hydrogen to India, Singh urged industry to visit these countries to analyze market opportunities.
In 2021, the government announced the National Hydrogen Mission to promote the generation and adoption of cleaner energy, including green hydrogen. The government plans to implement the Green Hydrogen Consumption Obligation (GHCO) in fertilizer production and oil refining, similar to what has been done with power purchase obligations renewable (RPO). RPOs require utility companies to purchase a fixed amount of renewable energy to reduce their reliance on fossil fuels. India’s total hydrogen demand is expected to reach 11.7 million metric tons (mmt) by 2029-30 from 6.7 mmt currently.
India has also recently engaged in bilateral partnerships to improve clean energy technologies. On Tuesday, February 15, India and Australia signed a Letter of Intent (LoI) on new and renewable energy technologies aimed at scaling up the manufacture and deployment of solar and clean hydrogen at very low cost. In January, India and Denmark agreed to launch joint research and development on green fuels, including green hydrogen.
At the International Solar Alliance (ISA) meeting, a solar hydrogen program was also launched to produce the emission-free fuel at $2 per kg, significantly lower than the current price of $5 per kg. Additionally, in a bid to expand the adoption of green power, the Center is also exploring a plan to run ships on green power which could involve a hybrid power model including a mix of solar power , sea water, wind and hydrogen, as indicated by mint earlier.
On Wednesday, the minister also said the government would extend the ongoing Renewable Purchase Obligation (RPO).
“We are going to come up with rules. We have a draft under consideration, in which we stipulate that the RPO obligation established by the central government will be followed,” Singh said.
He added that the government was considering increasing penalties for non-compliance with RPOs, through an amendment to the Electricity Act. Additionally, the new rules would include the target of 500 GW of renewable energy and storage would also come under the RPO umbrella.
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