Green Hydrogen in India: Govt Push vs. Global Demand Challenges | Exam Focus

India’s Green Hydrogen Ambition: High Hopes, Tough Realities
While the Indian government and industry leaders champion green hydrogen as a future energy powerhouse, weak global demand and policy flip-flops in key markets are hitting the brakes. Export slowdowns—driven by geopolitical tensions and stalled incentives abroad—are forcing a rethink of expansion timelines.

What Makes Hydrogen “Green”?
Grey Hydrogen: Made from fossil fuels (usually natural gas), releasing CO₂.
Blue Hydrogen: Also fossil-based, but captures ~80% of emitted CO₂.
Green Hydrogen: Uses renewable energy (solar/wind) to split water (H₂O) via electrolysers—zero emissions.

India’s National Green Hydrogen Mission: Key Goals
Target: Produce 5 million metric tonnes (MMT) annually by 2030.
Funding: ₹19,744 crore support.
SIGHT Programme: Boosts green hydrogen production and electrolyser manufacturing.

Why Export Demand is Stalling
US Policy Uncertainty: Trump’s proposed “Big Beautiful Bill” threatens the Inflation Reduction Act (IRA), which offers tax credits for low-carbon hydrogen.
High Costs: Green hydrogen costs $4-5/kg vs. grey hydrogen’s $2.3-2.5/kg.
Infrastructure Gaps: Ports, pipelines, and storage for hydrogen/ammonia remain underdeveloped.

Government’s Counter-Strategy
EU Partnerships: Talks with Rotterdam & Antwerp ports for smoother green ammonia exports.
Trade Deals: Pushing for reduced import duties via FTAs with Europe.
Certification Scheme: Developing standards to verify “green” credentials for global acceptance.

Carbon Credits & India’s CCTS
Carbon credits let polluters offset emissions by funding green projects. India’s Carbon Credit Trading Scheme (CCTS) aims to:
Create a domestic carbon market.
Incentivize emission cuts by industries.
Generate revenue for green hydrogen projects.

5 Immediate Fixes (CII-Bain Report)
Blending: Mix small green hydrogen percentages into grey H₂/natural gas for refineries, fertilisers, and city gas.
Niche Substitution: Target sectors like glass/ceramics where switching is cost-neutral.
Public Procurement: Prioritise green steel/ammonia in govt projects.
Boost Financing: Lower interest rates for green H₂ projects.
Fast-Track Infrastructure: Develop pipelines, storage, and port facilities.
Key Challenges Ahead
Cost Competitiveness: Bridging the $2/kg price gap with grey hydrogen.
Global Policy Volatility: US/EU incentives crucial for export demand.
Certification Clarity: Ensuring global recognition of India’s green H₂ standards.


Sample Q&A for Exam Prep:
Q1: What distinguishes green hydrogen from grey and blue hydrogen?
Ans: Green hydrogen uses renewable energy for electrolysis (zero emissions). Grey H₂ relies on fossil fuels without carbon capture, while blue H₂ captures ~80% of emitted CO₂.
Q2: What is the production target under India’s National Green Hydrogen Mission (2023)?
Ans: 5 million metric tonnes (MMT) per year by 2030.
Q3: Why is export demand for India’s green hydrogen slowing down?
Ans: Geopolitical tensions, stalled US incentives (IRA), and high production costs ($4-5/kg vs. $2.3-2.5/kg for grey H₂).
Q4: How does India’s Carbon Credit Trading Scheme (CCTS) support green hydrogen?
Ans: It creates a market for carbon credits, letting industries fund emission-reduction projects (like green H₂) to offset their pollution.
Q5: Name two demand-side strategies to boost green hydrogen adoption in India (CII Report).
Ans: (i) Blending green H₂ into grey hydrogen/gas supplies for refineries/fertilisers; (ii) Govt procurement of green steel/ammonia.