GREEN

HYDROGEN
POLICY 2022

SUBMITTED TO : ANIL KUMAR

SUBMITTED BY: ADITYA KUMAR
SAP ID : 500099993
GREEN HYDROGEN POLICY
OVERVIEW

 Hydrogen is the oldest, lightest and most

abundant element in the universe.
 As a gas it is an ultra-light energy carrier, and
when it is burned the only emission it
produces is water vapour.
 Hydrogen can also be used in fuel cells,
where it chemically reacts with oxygen to
produce electricity, without emitting any
pollutants or greenhouse gases.
 The only by-product of this chemical reaction
is pure drinkable water. But the main use of
hydrogen currently is as a feedstock for
industry.

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 HYDROGEN PRODUCTION 3

 Despite its abundance on Earth, hydrogen does not exist naturally in its pure form in large quantities. There
are no vast deposits of hydrogen in the ground that can be extracted. Hydrogen is found almost exclusively
in compounds, notably water molecules (hydrogen and oxygen) and fossil fuels (hydrogen and carbon).
Hydrogen can be released from these compounds, but doing so requires energy. A colour code nomenclature
is becoming commonly used to facilitate discussion:
 Grey hydrogen is produced with fossil fuels (e.g. hydrogen produced from methane using steam methane reforming or coal
gasification). The use of grey hydrogen entails substantial CO2 emissions, which makes these hydrogen technologies unsuitable
for a route towards net zero emissions. Moreover, the use of fossil gas brings the risk of leakages of methane, a potent
greenhouse gas. Around three-quarters of hydrogen is currently produced from fossil gas.
 Blue hydrogen has the same production process as grey hydrogen, but is complemented by carbon capture and storage. Blue
hydrogen can yield very low greenhouse gas emissions, but only if methane leakage does not exceed 0.2%, with close to 100%
carbon capture. Such rates are still to be demonstrated at scale.
 Green hydrogen is produced from renewable energy and is the hydrogen most appropriate for a fully sustainable energy
transition. The most established technology option for producing green hydrogen is water electrolysis fuelled by renewable
electricity. Other renewables-based solutions to produce hydrogen are possible, but these technologies are not yet technically
mature for production on a commercial scale.
HYDROGEN COLOURS

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 USES OF HYDROGEN

 Hydrogen gas is used mainly as a feedstock for the (petro)chemical industry,

including crude oil refining, ammonia synthesis (primarily for fertiliser
production) and methanol production for a wide variety of products
(including plastics).
 Hydrogen can also be used as a fuel. When burned, it can generate heat of
more than 1 000°C without emitting CO2.
 Further, hydrogen can be used in fuel cells, where it chemically reacts with
oxygen to produce electricity without emitting any pollutants or greenhouse
gases.
 The only by-product of this chemical reaction is water vapour.
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 GREEN HYDROGEN VALUE CHAIN

 Hydrogen is currently used mostly in oil refineries to remove

impurities, to upgrade heavy oil fractions in chemical
production and as a reducing agent in iron making.
 Industry demand for hydrogen was 87.1 Mt in 2020.
 Under IRENA’s 1.5°C Scenario, by 2050 hydrogen demand
reaches 613 Mt (74 EJ), at least two-thirds of which should
be green hydrogen.
 The electricity demand to produce hydrogen will reach
almost the level of global electricity consumption today.
 This requires significant scale-up of electrolyser
manufacturing, renewable energy capacity and deployment.
 Around 160 GW of electrolysers need to be installed
annually on average up to 2050.
 The installation rate starts growing from a few gigawatts
added per annum in the coming years and then significantly
ramps up from 2030 onwards. 6
 POLICIES TO SUPPORT GREEN HYDROGEN 7

 The green hydrogen industrial sector is in its infancy, yet to become competitive with
grey hydrogen. As with many infant industries, it therefore needs dedicated industrial
policy making.
 Industrial policies can take many forms; they can actively force the hand of industrial
stakeholders to change the status quo, make the fossil fuel option unattractive for
investors, or provide a supportive environment to attract investment in green hydrogen.
Supportive policies have been widely used in the energy sector to promote the
deployment of renewable electricity through support schemes, and these can offer many
lessons for green hydrogen. Transitioning green hydrogen from a niche player to a
widespread energy carrier will require an integrated policy approach to overcome initial
resistance and reach a minimum threshold for market penetration. That policy
approach should have four central pillars:
 National hydrogen strategy. Each country needs to define its level of ambition for hydrogen,
outline the pathway to reach the ambition and the amount of support required, and provide a
reference point on hydrogen development for private investment and finance.
Policy priorities. Green hydrogen can support a wide range of end uses. Policy
makers should identify and focus on applications that provide the highest
value.

Guarantees of origin. The carbon emissions assigned to hydrogen production

and transportation should reflect its whole life cycle. Origin schemes need to
include clear emission labelling for hydrogen and hydrogen products to
increase consumer awareness and facilitate carbon reduction incentives.

Governance system and enabling policies. As green hydrogen becomes

mainstream, policies should cover its integration into the broader energy
system. Civil society and industry must be involved to maximise the benefits.

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 POLICIES TO SUPPORT ELECTROLYSERS

Reducing GHG emissions in hard-to-abate sectors through the

use of green hydrogen will require large amounts of it, larger
than what is available from current (mostly grey) hydrogen
production. That, in turn, requires a rapid scale-up in the
number and overall capacity of electrolysers used to make
hydrogen. The roadmap described in IRENA’s 2022 World
Energy Transitions Outlook foresees a total installed electrolyser
capacity of 5 TW by 2050, up from today’s 300 MW. National
hydrogen strategies usually feature targets for electrolyser
capacity by 2030, with varying degrees of commitment. Target
setting can ensure the appropriate parallel development of
renewable energy and electrolyser capacity.
Still, supportive policies will be needed to both meet and exceed
such targets and achieve the necessary installed capacity by
2050.

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 POLICIES TO SUPPORT INDUSTRIAL USES

Industrial Uses are listed below:

 The industrial sector is the leading consumer of hydrogen. Hydrogen is used in refineries, the chemical industry and
steelmaking, all categorised as “hard-to-abate” sectors. This large and centralised core of demand is critical for
developing a green hydrogen sector.

 However, several barriers impede green hydrogen’s full contribution to the industrial sector, including cost, technical
obstacles, policy, lack of demand and carbon leakage risk. Policy makers can adopt industrial policies that address
these barriers and oblige or support a change from fossil fuel dependency in hard-to-abate sectors. This is an urgent
task given the long lifespan of industrial assets and the limited window to limit the climate crisis.
 Industrial users of hydrogen should be among the first recipients of green hydrogen, given the lack of alternative
decarbonisation solutions and the potential size of local hydrogen demand.

 Policy development should focus on the more mature and centralised hydrogen solutions, a process that can involve
dedicated research, planning and support.
Presentation title
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GREEN HYDROGEN PRIORITIES

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 CURRENT GREEN HYDROGEN
POLICY

 Hon’ble Prime Minister launched the National Hydrogen Mission on India’s 75th Independence Day (i.e.
15th August, 2021). The Mission aims to aid the government in meeting its climate targets and making
India a green hydrogen hub. This will help in meeting the target of production of 5 million tonnes of
Green hydrogen by 2030 and the related development of renewable energy capacity.

 Hydrogen and Ammonia are envisaged to be the future fuels to replace fossil fuels. Production of these
fuels by using power from renewable energy, termed as green hydrogen and green ammonia, is one of
the major requirements towards environmentally sustainable energy security of the nation. Government
of India is taking various measures to facilitate the transition from fossil fuel / fossil fuel based feed
stocks to green hydrogen / green ammonia. The notification of this policy is one of the major steps in this
endeavour.

 The policy provides as follows :

 Green Hydrogen / Ammonia manufacturers may purchase renewable power from the power exchange or set
up renewable energy capacity themselves or through any other, developer, anywhere. 12
 Open access will be granted within 15 days of receipt of application.
 The Green Hydrogen / Ammonia manufacturer can bank his unconsumed renewable power, up to 30 days,
with distribution company and take it back when required.
 Distribution licensees can also procure and supply Renewable Energy to the manufacturers of Green
Hydrogen / Green Ammonia in their States at concessional prices which will only include the cost of
procurement, wheeling charges and a small margin as determined by the State Commission.
 Waiver of inter-state transmission charges for a period of 25 years will be allowed to the manufacturers of
Green Hydrogen and Green Ammonia for the projects commissioned before 30th June 2025.
 The manufacturers of Green Hydrogen / Ammonia and the renewable energy plant shall be given
connectivity to the grid on priority basis to avoid any procedural delays.
 The benefit of Renewable Purchase Obligation (RPO) will be granted incentive to the hydrogen/Ammonia
manufacturer and the Distribution licensee for consumption of renewable power.
 To ensure ease of doing business a single portal for carrying out all the activities including statutory
clearances in a time bound manner will be set up by MNRE.
 Connectivity, at the generation end and the Green Hydrogen / Green Ammonia manufacturing end, to the
ISTS for Renewable Energy capacity set up for the purpose of manufacturing Green Hydrogen / Green
Ammonia shall be granted on priority.
 Manufacturers of Green Hydrogen / Green Ammonia shall be allowed to set up bunkers near Ports for
storage of Green Ammonia for export / use by shipping.
 The land for the storage for this purpose shall be provided by the respective Port Authorities at applicable
charges.
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 PRO BLEMS A SSO CIAT ED WIT H THE G REEN HYDR O G EN PO LICY:

 India's current hydrogen consumption is at 6.7 million tonnes (MT), with the need
predicted to increase by 2030. The majority of it is used as processing fuel in oil
refineries, fertiliser plants and steel mills to generate manufactured goods. It's
currently grey hydrogen that comes from fossil fuels like natural gas or naphtha.
 The cost of renewable power has dropped dramatically as a result of expanded
renewable power generation installation, making green hydrogen more practicable,
but it is still too costly to be competing with grey hydrogen.
 The policy's incentives will help cut the cost of green hydrogen generation, but the
fundamental problem will be to make it as economical as grey hydrogen, which is
now four to six times cheaper.
 Waiving centralized open access costs would cut manufacturing charges, but there
are state-level open access costs that may negate the intended incentives.
Consequently, coordinated initiatives are required to eliminate this variance in
charges and maximise the positive impact of policy incentives. 14
THANK YOU