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Green Hydrogen: High Hopes, Low Exports

Green Hydrogen: High Hopes, Low Exports

20-06-2025

Why in the News?

  1. India’s green hydrogen sector is getting a lot of attention. It is expected to play a big role in clean energy but the growth of this sector is slowing down.
  2. The main reason is weak export demand. Many global problems and changes in policies, especially in the US and Europe, are causing this slowdown.

What are the Key Highlights?

  1. Export Challenges:
    1. Global uncertainties and weak policy frameworks are holding back demand.
    2. The US Inflation Reduction Act (IRA), meant to boost clean energy, is stalled in the Senate. In Europe, large-scale green hydrogen imports are yet to begin.
  2. India’s Global Push:
    1. India is engaging with European ports to ease export logistics and negotiating trade agreements to reduce import duties on green hydrogen.
  3. Domestic Developments:
    1. ReNew (an Indian Company) is setting up a green ammonia plant in Odisha but faces poor offtake due to export weakness.
    2. The government is focusing on domestic demand through tenders and pilot projects.
    3. Solar Energy Corporation of India has floated tenders for 7–8 lakh tonnes of green hydrogen.
    4. Hydrogen-powered buses are being tested in Ladakh and other locations.
       
  4. Cost Barrier:
    1. Green hydrogen currently costs $4–$5/kg.
      1. Green Hydrogen: Made by splitting water using renewable electricity in an electrolyser; low emissions and clean.
    2. Grey hydrogen (from fossil fuels) costs only $2.3–$2.5/kg, making it more attractive to buyers.
      1. Grey Hydrogen: Made using coal or natural gas; high carbon emissions.
         
  5. Policy Support:
    1. The National Green Hydrogen Mission was launched in 2023 with ₹19,744 crore funding.
      1. It aims to build India’s green hydrogen production, reduce import dependency, and support the global clean energy transition.

What are the Significances of Green Hydrogen?

Significance of Green Hydrogen

  1. Clean Energy Source: Green hydrogen is produced using renewable energy (like solar or wind) and does not release carbon dioxide. It helps reduce greenhouse gas emissions and combats climate change.
  2. Energy Independence: India imports a large portion of its fossil fuels. Green hydrogen can reduce this dependence, making the country more self-reliant (Aatmanirbhar) in the energy sector.
  3. Industrial Decarbonisation: Green hydrogen can replace fossil fuels in sectors such as Steel production, Fertiliser manufacturing, Oil refineries, Heavy transportation (buses, trucks, ships)
  4. Versatility: It can be used as a fuel (in fuel cells for transport), A feedstock (for green ammonia, green methanol), For electricity storage (as a long-term battery alternative).
  5. Export Opportunities: As global demand for clean fuels rises, India can become a major exporter of green hydrogen and its derivatives like green ammonia, boosting economic growth and foreign exchange earnings.
  6. Job Creation and Innovation: The green hydrogen sector can create skilled jobs in manufacturing, engineering, and renewable energy. It also promotes R&D and investment in new technologies.
  7. Supports India's Climate Goals: Green hydrogen helps India meet its targets under the Paris Agreement and achieve Net Zero emissions by 2070.

Conclusion

Green hydrogen holds great promise for India’s clean energy future, offering a path toward energy independence and low-carbon growth. While global export challenges and high production costs are slowing momentum, India is wisely shifting focus to build strong domestic demand through policy support, tenders, and pilot projects. With sustained investment and innovation, India can emerge as a key player in the global green hydrogen landscape.

National Green Hydrogen Mission

  1. The Mission aims to make India a global hub for the production, usage, and export of green hydrogen and its derivatives.
  2. This goal aligns with India’s broader vision of becoming Aatmanirbhar (self-reliant) in clean energy and leading the global clean energy transition.
  3. The mission is expected to bring the following benefits:
    1. Significant decarbonisation of the Indian economy.
    2. Reduction in dependence on fossil fuel imports.
    3. Technology and market leadership in green hydrogen for India.
  4. Key Components of the Mission
    1. Exports Promotion: 
      1. The Mission will promote export opportunities for green hydrogen and its derivatives like green ammonia and green methanol.
      2. This will be achieved through supportive policies and strategic international partnerships.
    2. Boosting Domestic Demand: 
      1. The Government of India will mandate a minimum share of green hydrogen consumption by designated industries and sectors.
      2. This includes both use as energy (e.g. fuel) and as feedstock (e.g. for fertilizers or chemicals).
      3. A year-wise trajectory of required consumption will be decided by the Empowered Group (EG) set up under the Mission.
    3. Competitive Bidding for Procurement:
      1. To ensure transparent and cost-effective procurement, competitive bidding will be adopted for the purchase of green hydrogen and green ammonia.
      2. Demand aggregation will be used to attract private investment and reduce costs.
    4. Certification Framework:
      1. The Ministry of New and Renewable Energy (MNRE) will develop a regulatory framework for the certification of green hydrogen.
      2. This framework will ensure that the hydrogen and its derivatives are verifiably produced from renewable energy (RE) sources.

 

 

Important Keywords

 

  1. Electrolyser: It is a machine that uses electricity to split water into hydrogen and oxygen. It is used in the making of green hydrogen.

 

  1. Green Ammonia: A chemical made by combining green hydrogen with nitrogen (from the air). It is a cleaner and greener alternative to traditional ammonia.
    1. Uses: As a low-pollution fertilizer and as fuel for ships.

 

  1. Tender: An open offer by the government or a company to buy or sell a large quantity of something. The government invited companies to supply green hydrogen in bulk.

 

  1. IMO (International Maritime Organization): A United Nations body that looks after international shipping rules. It asked shipping companies to start using 5% clean fuels like green ammonia.

 

 

Ensure IAS Mains Question:

 

Q: “Green hydrogen has immense potential for India’s energy security and climate goals, but multiple challenges have slowed its progress.”Discuss the significance of green hydrogen for India and outline the key challenges and policy responses needed for its large-scale adoption. (250 words)

 

Ensure IAS Prelim MCQ

Q1. Consider the following statements regarding Green Hydrogen:

  1. It is produced using electrolysis powered by renewable energy sources.
     
  2. It emits carbon dioxide during production.
     
  3. It can be used to produce green ammonia, which is a low-carbon fertilizer.
     

Which of the statements given above is/are correct?

A) 1 and 2 only
B) 2 and 3 only
 C) 1 and 3 only
 D) 1, 2 and 3

Answer: C

Explanation:

  • Statement 1 is correct: Green hydrogen is produced by electrolysis using renewable energy like solar or wind.
     
  • Statement 2 is incorrect: Green hydrogen is clean and does not emit CO₂ during production.
     
  • Statement 3 is correct: Green hydrogen is used to make green ammonia, which is used as an eco-friendly fertilizer.
     

 

 

Green Hydrogen: High Hopes, Low Exports

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