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Green Hydrogen: Sanjeevani Booti For Driving India’s Energy Security, Energy Transition

By concentrating on below areas, India will strengthen its energy security and move towards a sustainable and prosperous future by supporting international collaboration in developing renewable energy sources to tackle climate change

The preservation of nature and its sanctity are deeply ingrained in India’s cultural ethos. Ancient Indian lifestyle imbibed the principles of harmonious living with nature to such an extent that water sources and trees were equated to sons, as illustrated by the hymn in Matasya Puran.

दशकूपसमा वापी दशवापीसमो ह्रदः ।

दशह्रदसमः पुत्रो दशपुत्रसमो द्रुमः ॥

A pond equals ten wells. A reservoir equals ten ponds.

A son equals ten reservoirs, and a tree equals ten sons!

For a nation like India, striving to balance its energy needs with environmental responsibility, Green Hydrogen has emerged as Sanjeevani Booti. India’s national security and sustainability objectives are closely linked to its pursuit of energy security. Prudent and efficient strategic choices must be made to create a resilient and self-sufficient energy infrastructure. Let us delve into how energy security relates to national security and sustainability in the context of India.

India’s twin challenges of energy security and decarbonization

India relies on imports for around 80 per cent of its energy needs, mainly crude and natural gas imports. In FY-24, India imported 232 million tons of Crude Oil (87 per cent of total requirement) at a US $ 132 Billion value, which was ~25 per cent of total imports. The vulnerability to fluctuations in the international price of crude oil and natural gas has been one of the primary reasons for India’s current account deficit for decades. India’s current account deficit (CAD), representing the country’s dependence on foreign currency borrowings or investments to finance the gap, has ranged between 1.5-2 per cent of the GDP for the last five years. It also weighs heavily regarding its impact on currency depreciation and inflation, which has consistently affected the GDP growth of the Indian economy.

Another aspect of fossil fuel energy imports is the problem of climate change associated with carbon emissions, which has become a global concern owing to the threat it poses to human existence on the planet. India is leading from the front in the fight against climate change. Unlike Western growth driven by fossil fuels, India has chosen to power its economic growth using cleaner sources. It has committed to reducing total carbon emissions by one billion tons and the carbon intensity of the economy by 45 per cent by 2030, which is over 2005 levels. These are critical milestones to achieve the net zero emissions target by 2070.

Green Hydrogen as a potential solution
Carbon emissions result from fossil fuel usage in power generation, transportation, and industrial processes. Thanks to rapid technological development, Green Hydrogen can be used as fuel and feedstock across all applications mentioned.

For example, Green Ammonia has been successfully blended to an extent of 20% in coal-based power plants in Japan, and pilots are also being done in India. Hydrogen turbines have been developed, which can be retrofitted in gas-based power plants and are proposed to be deployed on a large scale in Korea, Singapore, etc.

In road transport, fuel cells that use powered cars, trucks, etc., are commercially available. Further vehicles have been developed that can be propelled by either petrol/diesel blended with green or 100 per cent green methanol. While methanol-powered vehicles are quite popular in other countries, especially China, the US, etc, India is slowly catching up.

Several successful pilot projects, backed by India’s Methanol Economy Program, have showcased the viability of Methanol blending in India, which can utilize fuel blends incorporating green Methanol for vehicles such as cars, trucks, buses, and locomotives.

Green Hydrogen applications extend to shipping, where Green Ammonia and Green Methanol powered marine vessels are expected to be commercially operational by next year, and we are witnessing similar traction in aviation.

Finally, there are the industrial processes. Grey Hydrogen derived from natural gas is extensively used in industries such as fertilizers, steel, crude oil refining, etc. It can easily be replaced with Green Hydrogen, and technologies are now available.

India’s Approach to creating a Green Hydrogen Economy
The government of India has been proactive in recognizing the potential of Green Hydrogen along with its derivatives like Green Ammonia and Green Methanol in advancing India’s clean energy transition journey and progressively reducing its dependence on crude oil and natural gas imports, which will help reduce the current account deficit. Green Hydrogen generated using water electrolysis (powered by renewable sources of electricity) is emission-free. It can be produced in large volumes domestically owing to the abundant availability of renewable energy sources, evolved eco-system to execute such projects, and a conducive policy environment.

The National Green Hydrogen Mission, launched in 2023 last year, aims to establish India as a global hub for producing and exporting Green Hydrogen by increasing the country’s green hydrogen production. This helps ensure energy security and places India in a strategic position on the global energy map. The key outcomes of this mission are:

  • Development of green hydrogen production capacity of at least 5 MMTPA and renewable energy capacity addition of about 125 GW.
  • Close to $ 100 bn in expected investment and creating over 600,000 jobs.
  • Abatement of nearly 50 million tons of annual greenhouse gas emissions.

India could meet energy requirements using Green Hydrogen and become a net energy exporter. However, we need a focused approach, which includes providing infrastructure support, creating domestic demand, and using India’s soft power to leverage international cooperation to enable exports.

Infrastructure Support
Green Hydrogen production is power intensive. However, owing to the ease of exports, Green Hydrogen projects are coming up near coastal areas. Creating Green Hydrogen Manufacturing Hubs in these locations can facilitate accelerating Green Hydrogen in the country. The government can enable the transfer of a large quantum of renewable power from resource-rich regions to these hubs. Further, it can create large desalination plants to ensure adequate availability of fresh water. Pipeline infrastructure is critical for transporting Green Hydrogen to ports for exports and domestic consumption, which can be taken up as part of a larger project.

Mandates for Consumption
Being a new space, Green Hydrogen is presently costlier than Grey Hydrogen – however, Green Hydrogen costs are expected to decline rapidly with the increase in scale of production. Thus, like renewable purchase obligations (RPOs), which were effective in bringing down the cost of renewable energy, mandates may be introduced by Govt. to encourage the consumption of Green Hydrogen and create domestic demand, especially for sectors like refining, fertilizers, steel, etc.

Similarly, in the case of the transport sector in India, the government encouraged ethanol production by increasing ethanol blending to 20% by 2025, which has resulted in a massive increase in ethanol production from biosources in the country.

Green Methanol is another fuel that can be produced from Hydrogen derived from water and carbon dioxide from chimney stacks of thermal power plants, cement plants, etc. Its production, unlike ethanol, is without any conflict with the food supply chain. Green Methanol blending is still optional, hindering the widespread adoption of green Methanol. To kickstart this transition, government intervention is crucial. Starting with a modest 15 per cent blending requirement and gradually increasing it over time could provide the necessary impetus. Such a mandate could generate a demand for 5 billion litres of Methanol, encouraging domestic production. Furthermore, mandating the blending of Dimethyl Ether (a derivative of Methanol) with LPG could bolster the nation’s energy security efforts.

International Cooperation for exports
There is significant demand for Green Hydrogen and its derivatives in the EU, Japan, Korea, Singapore etc. Due to constraints in terms of resource availability, a large portion of this demand is proposed to be imported. Thus, there is a massive market that Indian developers can capture. However, regions like the Gulf, Australia, Northern Africa, the US, etc., are favourably placed due to resource availability and substantial fiscal support from respective Governments. Hence, to create a level playing field, India needs to leverage its soft power by using diplomatic relations provisions like Article 6 of the COP agreement, allowing developing countries to trade ITMOs.

Green Hydrogen is a promising solution for India’s energy security and sustainability challenges. The nation’s aggressive goals for producing green Hydrogen and its emphasis on cutting carbon emissions and switching to renewable energy sources demonstrate how important sustainability is for the country’s energy strategy.

By concentrating on these areas, India will strengthen its energy security and move towards a sustainable and prosperous future by supporting international collaboration in developing renewable energy sources to tackle climate change.

The author is Vineet Mittal, Chairman of Avaada Group

Green Hydrogen: Sanjeevani Booti For Driving India’s Energy Security, Energy Transition

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