The National Hydrogen Mission was launched in 2021 to draw up a roadmap for using hydrogen as an energy source. Power Minister RK Singh, on Thursday, unveiled the first phase of the plan, while setting sights for the country to not only meet its climate targets but also turn itself into a green hydrogen export hub.

Under the first phase, the government has offered a waiver of inter-state transmission charges of renewable energy for a period of 25 years to manufacturers of green hydrogen and green ammonia for projects commissioned before June 30, 2025. Renewable energy is used in the production of green hydrogen and ammonia.

Read Here: New Hydrogen Policy: Phase 1 to focus on ease of manufacturing green hydrogen; India can be next export hub, says power minister

To understand how beneficial these initiatives will be in producing green hydrogen cheaply and in making India an export hub for green hydrogen, CNBC-TV18 spoke to Subramanian Sarma, Whole-time Director-Energy and CEO of L&T Hydrocarbon Engineering, Vartika Shukla, CMD, Engineers India, Jal Irani, Senior VP, Institutional Equity Research of Edelweiss Financial Services.

First up, Sarma highlighted that India is the world’s third-largest consumer of fossil fuels. According to him, transition to green energy is giving the country an opportunity to become self-reliant. However, he explained that the cost of green hydrogen is twice the cost of conventional hydrogen, additionally cost of storage continues to add substantially to the cost of energy.

Sarma said, "India is one of the third-largest consumers of fossil fuel and also the third largest emitter of carbon dioxide. I think what this ESG energy transition and green hydrogen advancement are doing is giving us an opportunity to leapfrog and become more self-reliant, as well as generate clean energy."

"The one part of the equation which has to be addressed is affordability because we are still a growing economy. Today, the cost of green hydrogen is almost 4 times the conventional hydrogen, that is grey hydrogen, and effort has to be made to reduce this cost," he explained.

He added, “Banking facility is important because round the clock, power is required for hydrogen. Because the battery technology is still evolving, it also adds up significantly to the cost of energy. Now, by having this banking facility of 30 days or something, you can eliminate or you can reduce substantially the storage cost.”

Read Here: Explained: How government's ambitious green hydrogen policy will work

Meanwhile, Irani believes that India has the potential to become the Middle East of hydrogen. He believes India’s cost of green hydrogen production will be significantly lower.

He said, "I believe India can become the Middle East of green hydrogen in the longer term. Essentially, India has got significant advantages not just in green hydrogen, but across in the entire new energy chain, which needs to be developed."

He added, "Few companies have gone on record to say that India could produce green hydrogen at less than $1 per kg. Now, needless to say, global costs are also coming down, but India will still be significantly cheaper than what green hydrogen cost could be, globally. Therefore, it could become the hub for green hydrogen and change India's energy paradigm altogether."

Meanwhile Shukla said that energy demand is likely to double in the next 20-25 years. She believes converting to green hydrogen will be an easy task for the country.

“We need to address the need for decarbonisation of industries, technologies that we use. It is also given that based on the operations of the nation and the growth that we are having, energy demand is likely to double in the next 20-25 years," she said.

She added, "We are very adjacent to the business of green hydrogen. We are already having a very strong presence in the refinery sector as well as the fertiliser sector. Having said that, the conversion of grey hydrogen, which we know in and out, which we have implemented is therefore an easy task for us- to look at green hydrogen’s entry into lowering the carbon footprint.”

Watch the video for the full interview.

First Published:Feb 18, 2022 1:06 PM IST