According to a report, India will produce about 55 million tonnes of green hydrogen in 2050. However, due to a slower demand uptake profile, the country will remain a marginal importer in the coming decade.
The need for transition to hydrogen
• Rise of technologies such as solar and wind, lithium-ion batteries, and alternative fuels have paved the way for decarbonization in various end-use sectors. However, there are certain sectors like industry and heavy transport that are hard to decarbonize using the current low or zero-carbon technologies. Hydrogen promises to address those challenges and contribute to the decarbonization of these hard-to-abate sectors.
• Hydrogen is an energy carrier and can be used for a wide array of energy and industrial applications. The opportunities and challenges of hydrogen emerge from its energy characteristics.
• Hydrogen’s specific energy (energy content per unit of mass) is higher than most hydrocarbon fuels. But its volumetric energy density is the lowest. That means pressurisation or liquefaction is required for hydrogen to be useful as a fuel. These two properties drive the value as well as the applicability of hydrogen for the various possible end-use cases.
• Many sectors such as iron ore and steel, fertilisers, refining, methanol, and maritime shipping emit major amounts of CO2, and carbon-free hydrogen will play a critical role in enabling deep decarbonization.
• For other high-emitting sectors, such as heavy-duty trucking and aviation, hydrogen is among the main options being explored with an outlook to be the preferred solution for several applications.
• This has resulted in growing global momentum towards hydrogen in general, and green hydrogen in particular.
• There is an increased consensus around the world that concerted steps need to be taken to reduce global warming to levels less than 2°C and if possible to cap it at 1.5°C higher than pre-industrial levels. Various countries have pledged their Nationally Determined Contributions to ensure energy transition and reduce emissions.
• Declining prices of hydrogen, coupled with growing urgency for decarbonization means the global demand for hydrogen could grow by almost 400 per cent by 2050, led by industry and transportation.
• At least 43 countries have now set up or are setting up strategies or roadmaps for a hydrogen economy, including financial incentives to accelerate the transition.
• A NITI Aayog report has estimated that the cumulative value of the green hydrogen market in India will be $8 billion by 2030 and $340 billion by 2050.
Production of hydrogen
Although hydrogen is the lightest and most abundant element in the universe, it is rarely found in nature in its elemental form and always must be extracted from other hydrogen-containing compounds. It also means that how well hydrogen contributes to decarbonization depends on how clean and green the method of production is.
Based on the sources and processes, hydrogen can be classified into various colours:
i) Black/Brown/Grey hydrogen is produced via coal or lignite gasification (black or brown), or via a process called steam methane reformation (SMR) of natural gas or methane (grey). These tend to be mostly carbon-intensive processes.
ii) Blue hydrogen is produced via natural gas or coal gasification combined with carbon capture storage (CCS) or carbon capture use (CCU) technologies to reduce carbon emissions.
iii) Green hydrogen is produced using electrolysis of water with electricity generated by renewable energy. The carbon intensity ultimately depends on the carbon neutrality of the source of electricity. Which means, the more renewable energy there is in the electricity fuel mix, the “greener” the hydrogen produced.
Central to the green hydrogen production process is the electrolyser technology. Alkaline and polymer electrolyte membrane (PEM) electrolysers are two commercially available technologies for green hydrogen production today. Advanced electrolyser technologies like solid oxide and anion exchange membrane are nearing commercial deployment as well.
Other less prevalent sources of production include bio-hydrogen which can either be produced by an SMR process around methane produced by anaerobic digestion of organic waste or through a fermentation process by bacteria.
India’s Green Hydrogen Policy
• Transition to green hydrogen and green ammonia is one of the major requirements for reduction of emissions, especially in the hard to abate sectors.
• The government of India considered a number of policy measures in order to facilitate the transition from fossil fuel based feed stocks to green hydrogen/green ammonia both as energy carriers and as chemical feedstock for different sectors. After careful consideration, the government of India has framed the policy on green hydrogen.
• The ministry of power unveiled the first part of the Green Hydrogen Policy on February 17, 2022. The policy is one of the key outcomes of the National Hydrogen Mission which was launched by Prime Minister Narendra Modi on India’s Independence Day in 2021.
• It marks the culmination of months of efforts across multiple ministries and stakeholder groups, and affirms India’s intent to be a global green hydrogen hub.
Growth in hydrogen demand in India
• For India, this current impetus surrounding the hydrogen transition fits well within the context of a low-carbon economy, energy security, and the larger economic development ambition of the nation.
• India’s distinct advantage in low-cost renewable energy generation makes green hydrogen the most competitive form of hydrogen in the long run. This enables India to potentially be one of the most competitive producers of green hydrogen in the world.
• Green hydrogen can achieve cost parity with natural gas-based hydrogen (grey hydrogen) by 2030, if not before. Beyond cost, since hydrogen is only as clean as its source of generation, green hydrogen will be necessary to achieve a truly low carbon economy.
• It will also enable the emergence of a domestically produced energy carrier that can reduce the dependence on imports for key commodities like natural gas and petroleum.
• Hydrogen demand in India could grow more than four-fold by 2050, representing almost 10 per cent of global hydrogen demand. Initial demand growth is expected from mature markets like refinery, ammonia, and methanol, which are already using hydrogen as industrial feedstock and in chemical processes.
• In the longer term, steel and heavy-duty trucking are likely to drive the majority of demand growth, accounting for almost 52 per cent of total demand by 2050.
• From a price parity basis alone, green hydrogen’s share of this demand could grow from 16 per cent in 2030 to almost 94 per cent by 2050. This translates to an implied cumulative electrolyser capacity demand of 20 GW by 2030 and 226 GW by 2050, promising a sizeable opportunity for indigenous manufacturing of a global emerging energy technology.
• The cumulative value of the green hydrogen market in India could be $8 billion by 2030 and $340 billion by 2050. Electrolyser market size could be approximately $5 billion by 2030 and $31 billion by 2050.
• Adoption of green hydrogen will also result in 3.6 giga tonnes of cumulative CO2 emissions reductions between 2020 and 2050.
• Energy import savings from green hydrogen can range from $246 billion to $358 billion within the same period.
• Beyond the financial savings, the energy security that green hydrogen provides will translate to less volatile price inputs for India’s industries as well as strengthen India’s foreign exchange situation in the long run.
Source: PTI
