The government has identified 10 potential states that could be key drivers of green hydrogen production.
According to two officials with knowledge of the matter, this will help India launch its national green hydrogen mission. These states are Karnataka, Odisha, Gujarat, Rajasthan, Maharashtra, Tamil Nadu, Andhra Pradesh, Kerala, Madhya Pradesh and West Bengal, which may have green hydrogen or ammonia production areas or clusters.

“The states were identified based on the region’s existing steel and fertiliser industries, refineries and ports, renewable energy operations and potential power generation capacity. In some places, we also integrated the city gas distribution network, as this is another can sector to absorb green hydrogen,” said a senior official of the Ministry of New and Renewable Energy (MNRE).

On November 2, the Karnataka government signed an agreement worth Rs 5.2 lakh crore on the opening day of the three-day Invest Karnataka 2022 global investors meeting. Of the Rs, 5.2 lakh crore investment, Rs 2.9 lakh crore will be in the green hydrogen and derivatives sector alone. The Karnataka government aims to build India’s first green hydrogen manufacturing cluster or district.

The country’s largest steelmaker, Odisha, has also decided to push the production of green hydrogen and green ammonia. Green hydrogen obtained from water splitting using solar and wind power offer a cleaner alternative to steel production. It also helps reduce the industry’s reliance on imported coking coal. The state, which has some important ports and is developing new ones, is also positioning itself as a green hydrogen export hub for investors.

Gujarat has reserved 6,000 square kilometres of plots in Banaskantha and Kutch specifically for hydrogen projects in the state. Tamil Nadu has approved ACME Group’s Rs 52,474 crore green hydrogen and ammonia project. The proposed project includes a 5 gigawatt (GW) solar power plant, a 1.5 GW electrolyser and 1.1 million tons of ammonia production capacity.

First announced by Prime Minister Narendra Modi in his Independence Day speech in August 2021, the final draft of a green hydrogen mandate across the country is undergoing a series of approvals and could be released in December. The draft mission proposes a demand-creating framework and package of measures to support indigenous production and use of green hydrogen.

It also includes research and development efforts, pilot projects, enabling policies and regulations, and infrastructure development.

The government is expected to allocate a production-related incentive (PLI) scheme worth Rs 10,000-12,000 crore for electrolysers and green hydrogen from the Rs 20,000 crore green hydrogen mission. However, PLI for making green hydrogen may be a limited offer.

Union Power Minister RK Singh also hinted at this at an event on October 17. “Only the initial capacity will require PLI to produce green hydrogen, maybe 4-5 million tonnes. After that, green hydrogen (industry) will stand on its own,” he said.

The minister also spoke about green hydrogen manufacturing capacity, saying that the industry has shown interest in 25 million tonnes of green hydrogen capacity, a figure that could easily exceed 35-40 million tonnes. India plans to produce 5 million tonnes of green hydrogen annually by 2030.

In February, the government released its Green Hydrogen Policy, promising cheaper renewable energy, 25 years of interstate transmission fee relief for projects commissioned by June 2025, land in renewable energy parks, and for this purpose, Create a manufacturing area.