Home / Industry / Energy /  India may call bids for setting up green hydrogen plants

NEW DELHI: State-run Solar Energy Corporation of India (SECI) may call bids for setting up green hydrogen plants, said two people aware of the development.

Green hydrogen is a next generation fuel, with gas produced through electrolysis from water by using electricity generated through non-greenhouse gas (GHG) producing energy sources such as wind, solar or hydro. Hydrogen is also produced from others sources such as coal, oil and gas.

Being emission free and having three times higher energy content per unit mass than gasoline, green hydrogen is being looked at as a preferred fuel source for both transportation and storage applications.

“Hydrogen is the cleanest source of energy. The work is going on for calling these bids, and an Expression of Interest (EoI) will be floated first. Given the large clean energy programme we have, the plan is to set up these hydrogen production units by leveraging wind and solar power as hydrogen production is a very energy intensive process," said a government official cited above requesting anonymity.

This assumes significance given that there has been rapid pace of clean energy capacity addition by India at low tariffs. Apart from reducing India's dependence on fossil fuels; these green hydrogen plants will also help in providing grid scale storage solutions, resolving electricity transmission and evacuation related problems for clean energy projects and provide the feedstock for ammonia production.

“Apart from reducing our dependence on fossil fuels, it will also help in resolving electricity transmission and evacuation related problems for these green energy projects and can be the feedstock for ammonia production. This will also help in reducing India’ fertilizer imports," the official added.

“Post Covid-19, hydrogen has gained momentum and it is given priority in the green recovery or sustainable energy plan in Australia, Canada, China, Germany, Japan, South Korea, Spain and USA. European Union recently issued a Hydrogen Strategy for a Climate-Neutral Europe. Spain also approved a Hydrogen Roadmap while one in Canada is expected soon. Germany fixed a target of 5 GW of electrolysers by 2030 and another 5 GW by 2040. India should consider hydrogen more seriously and should have a Green Hydrogen Strategy and Roadmap on fast track," said Reji Kumar Pillai, president, India Smart Grid Forum.

This assumes significance given that there has been rapid pace of clean energy capacity addition by India at low tariffs. Clean energy projects now account for more than a fifth of India’s installed power generation capacity. India now has 34.6 GW of solar power and 38GW of wind power and seeks to produce 100 GW from solar projects and 60GW from wind power plants by March 2022.

Some experts say that hydrogen is a technology worth investing in.

“Grid scale power storage technologies are still evolving and India needs to invest in diverse technologies till one of them emerges as a clear winner. Hydrogen is one such technology worth investing in. Given that hydrogen production is energy intensive, we must explore options of generating hydrogen through cheap solar powered plants which in-turn would support hydrogen-based energy storage creating a potentially symbiotic relationship," said Rajesh Ivaturi, partner, power and utilities at EY India.

“Hydrogen economy will be a cornerstone of the future energy system. Hydrogen will replace natural gas by end of next decade. Cost of renewable powered hydrogen production through electrolysis will decrease exponentially in coming years as electricity cost is the highest cost component in production," added Sanjay Aggarwal, managing director, Fortum India Pvt. Ltd.

Queries emailed to SECI and a spokesperson for India’ ministry of new and renewable energy on Friday remained unanswered.

A bevy of Indian public and private sector firms including NTPC Ltd, Indian Oil Corporation, Acme Solar and Greenko among others are looking at hydrogen as a new business opportunity.

SECI’ move also comes in the backdrop of India facing deteriorating air quality levels. This also assumes significance given that solar and wind are infirm sources of energy, with storage holding the key to providing on-demand electricity from wind and solar projects.

“Hydrogen has many diverse uses—oil refining, ammonia and steel production, transportation (fuel cells) etc. But perhaps the most interesting one for India is its usage for power storage. As India is moving towards creating large (and fairly cheap) renewable energy capacity, which is inherently intermittent, we need to also develop large power storage solutions to address the peaking demand and to reduce the dependence on fossil fuel-based power generation," said EY’ Ivaturi.

The Union government is also exploring a plan whether an entire city’ mass transportation system such as buses can be run on hydrogen and use battery storage, provided the per km cost of operations is equal to or less than conventional fuel sources such as diesel.

Experts believe that the price of hydrogen production will come down.

“The price of electrolyser is above eight hundred dollar per kilo-watt. As per US department of Energy’ projections this will be below $200 by 2040. But some entrepreneurs are already promising electrolyser at $550 per kilo-watt this year and grey hydrogen at $2 per kilogram. With solar power at one rupee per unit (kWh), we should be able to generate green hydrogen at one dollar per kilogram soon," said Pillai, who is also the chairman of Global Smart Energy Federation.

“Off-course hydrogen economy ecosystem will take years to develop but hydrogen economy can balance energy production and consumption, store energy, enabling decarbonization of industry, carbon free transportation along with EV and help in realizing dream of carbon neutral energy system in future," added Aggarwal who heads Indian operations for Finland’s state-controlled power utility Fortum Oyj.

Utpal Bhaskar
"Utpal Bhaskar leads Mint's policy and economy coverage. He is part of Mint’s launch team, which he joined as a staff writer in 2006. Widely cited by authors and think-tanks, he has reported extensively on the intersection of India’s policy, polity and corporate space.
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