Indian hydrogen body submits $5bn development plan for five green hydrogen hubs

India’s hydrogen body plans to invest $5bn in five green hydrogen hubs

The India Hydrogen Alliance (IH2A) has submitted to the Government of India a National Green Hydrogen Hub Economic Viability and Development Plan, with the potential to create five large National Green Hydrogen Corporations worth $5 billion by 2030 through public-private partnerships.

The IH2A plan seeks public finance support for green hydrogen production and offtake in order to build the necessary infrastructure between 2024 and 2030.

The corporations formed as a result of the investment will be publicly traded in order to help fund the next wave of investments aimed at scaling up the hydrogen economy.

The plan was prepared as a 50:50 public-private Special Purpose Vehicle with a 150 megawatt (MW) electrolyzer capacity, storage and evacuation infrastructure, renewable energy inputs, green ammonia production plants, and off-take by industrial and mobility users, with a $468m CAPEX outlay over a 20-year project period, based on a reference economic model of the Green Kochi Hydrogen Hub (GKH2).

Jill Evanko, Chief Executive and President of Chart Industries (Chart) and a founding member of IH2A, commented on the announcement, calling the Plan a pathway for India to accelerate Green Hydrogen Hub development.

“India can leapfrog other economies on green hydrogen development by sharing the risks and rewards of green hydrogen project development between public and private sectors.”

She added that India plans to announce at least one of these large-scale green hydrogen hubs during the G20 Summit this year, emphasizing the importance of public financial support for national hubs.

“The Indian government stands to gain significantly from this approach, which demonstrates how India can create a National Green Hydrogen Unicorn within the next seven years.”

IH2A has also proposed green ammonia and hydrogen hubs at the state level to Gujarat, Maharashtra, Andhra Pradesh, Karnataka, Kerala, and Tamil Nadu.

According to Amrit Singh Deo, Senior Managing Director of FTI Consulting and IH2A Secretariat Lead, the Plan’s economic modeling is based on assumptions about public finance incentives, renewable energy costs, end-use offtake, and project structuring on a public-private partnership format.

“The model is replicable and demonstrates that financially viable green hydrogen can be designed and built. The model can be supported with techno-commercial studies, and should accelerate project development,” he added.

Earlier this year, New Delhi approved a $2 billion deal to promote green hydrogen in order to reduce carbon dioxide (CO2) emissions and become a key exporter in the sector.

According to a source, the government will provide incentives worth at least 30 Indian rupees ($0.36) per kg for the production of green hydrogen fuel, according to a Reuters report.

In India, the cost of producing green hydrogen is currently around 300 rupees ($3.63) per kg.

India has set a goal of generating half of its installed electricity capacity from non-fuel sources by 2030 and reaching Net Zero by 2070.