Six months after Prime Minister Narendra Modi had announced the launch of the National Hydrogen Mission, India on Thursday announced a major policy enabler for production of ‘green hydrogen’ and ‘green ammonia’ using renewable sources of energy with a clear aim of making India a green hydrogen hub.
The implementation of this policy will reduce dependence on fossil fuel and also reduce crude oil imports. As part of India’s global promise to combat climate change, among the five main announcements, one is to meet 50 per cent of the country’s energy requirements using renewable energy sources by 2030.
Allowing green hydrogen/green ammonia manufacturers purchase renewable power from power exchange, offering grid connectivity, benefit of renewable purchase obligation (RPO), and incentives for bunks near ports for export are some of the hallmarks of the policy.
The policy decision will help the government in meeting its international commitment for climate actions with 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/green ammonia, is one of the major requirements towards environmentally sustainable energy security of the nation, a release from the Power Ministry said.
Government 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 release said.
As per the policy, green hydrogen/green ammonia manufacturers may purchase renewable power from the power exchange or set up renewable energy capacity themselves or through any other, developer, anywhere, they will have open access within 15 days of receipt of application and the manufacturer can bank his unconsumed renewable power, up to 30 days, with a distribution company and take it back, when required.
Further, 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.
The policy will also waive of inter-state transmission charges for a period of 25 years to the manufacturers for the projects commissioned before June 30, 2025 even as the manufacturers and the renewable energy plant will be given connectivity to the grid on priority basis to avoid any procedural delays.
The benefit of RPO will be granted incentive to the hydrogen/ammonia manufacturer and the distribution licensee for consumption of renewable power, the release said, adding, 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 the Ministry of New and Renewable Energy.
Connectivity, at the generation end and the green hydrogen/green ammonia manufacturing end and the renewable energy capacity set up for the purpose of manufacturing them will be granted on priority, the policy stated.
Manufacturers of green hydrogen/green ammonia shall be allowed to set up bunkers near Ports for storage for export/use by shipping. The land for the storage for this purpose shall be provided by the respective Port Authorities at applicable charges, the release said.
The policy promotes RE generation as this will be the basic ingredient in making green hydrogen. This in turn will help in meeting the international commitments for clean energy, the release added.