Sudarshan Varadhan

NEW DELHI, (Reuters) – India plans to produce a total of five million tonnes green hydrogen per year by 2030 according to the power ministry. This is in line with its ambition to achieve its climate targets as well as become a major export and production hub for this fuel.

The best environmentally-friendly fuel, green hydrogen, is produced from renewable energy. Zero-carbon fuels are made from renewable energy, such as wind and solar power. They use water to make hydrogen and oxygen.

According to the federal power ministry, India will establish manufacturing zones. It will also waive inter-state electricity transmission charges for 25 year and offer priority connectivity to electric networks to ammonia or green hydrogen producers, in an effort to stimulate production.

Five million tonnes is less than the target of the European Union. It plans to make 10 million tonnes hydrogen from renewable energy in 2030.

Green hydrogen can’t be produced in India commercially at the moment, but India’s most powerful men Gautam and Mukesh Adani announced that they would produce it.

India has more people than three times the EU’s, and so its per capita energy consumption is much lower than that of the EU. However, it experiences one of the highest rates global energy demand growth.

ReNew Power chief commercial officer Mayank Bansal said that India’s incentives might help reduce the cost of hydrogen production.

Bansal released a statement saying that green hydrogen manufacturing is currently a very expensive proposition. He also stated that the government had correctly waived all interstate transmission costs.

RK Singh (India’s Power Minister) stated Wednesday that green hydrogen makers would also be allowed transmit unutilized electricity to the grid.

Indian’s first national hydrogen policy was announced Thursday with the announcement of incentives. It is not clear when the remainder will be made available by government.

India plans to offer federal financial assistance to establish electrolysers. This is because it intends to mandate the use of green hydrogen in fertilizer plants and refineries.