The proposal recommends 10 per cent green hydrogen use in existing plants, 100 per cent in new builds to meet NGHM 2030 goals

The India Hydrogen Alliance (IH2A) has urged the Government of India to introduce mandatory Hydrogen Purchase Obligations (HPOs) and industrial demand-side support to ensure the success of the National Green Hydrogen Mission (NGHM) 2030. In its submission to the government, IH2A recommended HPOs for refineries and ammonia plants – 10 per cent for existing installations and 100 per cent for new builds by 2030 – to meet the domestic green hydrogen target of 1.5 million metric tonne (MMT).

The proposal seeks to address India’s current shortfall in green hydrogen production, with less than 40 MW of installed electrolyser capacity generating just 10,600 metric tonnes annually, or under 1 per cent of the 2030 target. Without mandated offtake and aggregated demand, IH2A warned that over USD 80 billion in hydrogen-related investments risk becoming stranded assets.

IH2A has identified 47 existing and upcoming industrial sites – 17 refineries and 22 ammonia plants among them – where HPOs could accelerate the shift from grey to green hydrogen. The proposed obligations are divided into two key categories:

A 10 per cent HPO across 39 existing projects to meet 45 per cent of the NGHM target, representing 672,000 metric tonne of demand;

A 100 per cent HPO for eight new and expansion projects across five refineries and three fertiliser units, covering 849,000 metric tonne or 55 per cent of the target.

“The government should consider mandatory Hydrogen Purchase Obligations to induce domestic industrial offtake in refineries and ammonia sectors,” said Amrit Singh Deo, Secretariat lead, IH2A. “This could replicate the success of Renewable Purchase Obligations (RPOs) in the clean energy sector and ensure hydrogen investments deliver long-term value.”

IH2A has also called for a Common Hydrogen Use and Demand Roadmap for both refineries and fertiliser units to standardise procurement, reduce transaction costs, and simplify the transition to green hydrogen. The Alliance further suggested adopting a Japan-style Contract-for-Difference (CfD) mechanism to partially fund the shift in these hard-to-abate sectors.

According to IH2A estimates, a USD 2 billion CfD allocation could support the transition of all existing refinery and fertiliser plants to a 10% green hydrogen mix, and 100 per cent for new plants, by 2030.

By mandating HPOs and enabling industrial demand aggregation, IH2A believes India can not only achieve its NGHM targets but also position itself as a global green hydrogen leader while reducing emissions in two of its most carbon-intensive industries.