National Hydrogen Mission: Step Towards Robust Energy Security

Introduction
India's energy landscape is at a crucial turning point, and green hydrogen will have an essential role in making the country self-sufficient and energy independent. As an energy carrier, hydrogen is becoming crucial for decarbonizing hard-to-abate sectors. Carbon-free hydrogen will enable substantial decarbonization in several industries, including those that produce iron ore and steel, fertilizers, methanol, refining, and marine shipping, which all emit significant volumes of carbon dioxide (CO2). Moreover, for other high-emitting sectors, such as heavy-duty trucking and aviation, hydrogen is one of the key solutions being investigated with an outlook to be the preferred solution for several applications. With the growing urgency for decarbonization and declining prices of hydrogen, the global demand for hydrogen could grow by almost 400% by 2050, fueled by industry and transportation. Presently, India spends more than US$ 160 billion in foreign exchange every year for energy imports, which are estimated to double in the next 15 years without remedial action. Prime Minister Mr. Narendra Modi announced the National Hydrogen Mission on the 75th Independence Day to provide a comprehensive action plan for establishing a Green Hydrogen economy making India a hub for the production and export of green hydrogen. The expected outcomes of the mission by 2030 are as follows:

• By 2030, domestic consumption will have the largest electrolysis (green hydrogen generation) capacity in the world of over 60 GW/5 million tons, with India accomplishing its target of 500 GW of renewable energy.
• 15-20 million tons of green steel will be produced worldwide by 2030, a ground-breaking endeavor to make green steel a global standard.
• By 2028, the largest electrolyser in the world with an annual manufacturing capacity of 25 GW, delivering affordable prices to the world.
• By 2030, India will have the largest green ammonia production in the world. Up to 100 GW of green hydrogen may be needed to assist India’s allies in their efforts to decarbonize.
• By 2030, an investment of US$1 billion in hydrogen research and development will enable revolutionary innovations for the entire world at scale and at the appropriate pace.

Types of Hydrogen
Based on the sources and production, hydrogen can be classified into various colors:

• Black / Brown / Grey hydrogen
  It is produced either by coal or lignite gasification (brown or black) or through the steam methane reformation (SMR) of methane (grey) or natural gas. Most of these have a high carbon footprint.
• Blue hydrogen
  It is created by gasifying coal or natural gas with technologies like carbon capture storage (CCS) or carbon capture use (CCU) to reduce carbon emissions.
• Green hydrogen
  It is generated by electrolyzing water using the power produced from renewable sources. The carbon intensity is determined by how carbon neutral the power source, that is utilized for generating the green hydrogen. In other words, the more renewable energy source is used in the electrical fuel mix, the “greener” the hydrogen is produced. To produce green hydrogen, two commercially accessible technologies are alkaline and polymer electrolyte membrane (PEM) electrolysers.

National Hydrogen Mission
The National Hydrogen Mission India launched by Prime Minister of India, Mr. Narendra Modi on 75th Independence Day (15th August 2021), states that, by 2030, India will increase its capacity to produce green hydrogen by at least 5 million tons (MT) annually with an associated capacity addition of 125 gigawatts (GW) of renewable energy. This would entail total investments of US$ 97.62 billion (Rs 8 lakh crore) and is anticipated to generate 6 lakh jobs.  Additionally, it will result in a cumulative decrease of over US$ 12.20 billion (Rs 1 lakh crore) in fossil fuel imports as well as a reduction of nearly 50 MT of greenhouse gas emissions annually.

Moreover, the initial outlay was US$ 2.4 billion (Rs 19,744 crores), which includes US$ 2.1 billion (Rs 17,490 crores) towards the Strategic Interventions for Green Hydrogen Transition Program (SIGHT), US$ 178.9 million (Rs 1,466 crores) for pilot projects, US$ 48.8 (Rs 400 crores) for Research and Development (R&D) and US$ 47.34 million (Rs 388 crores) for other mission components. The Ministry of New and Renewable Energy (MNRE) will formulate the guidelines for the scheme for implementation of respective components.

Mission’s Sub-Components

• SIGHT Programme: The Strategic Interventions for Green Hydrogen Transition Programme (SIGHT) incentives 2 distinct financial incentive mechanisms, targeting domestic manufacturing of electrolysers and the production of green hydrogen.
• Pilot Projects: It will support pilot projects in emerging end-use sectors and production pathways. Regions that can sustain large-scale hydrogen generation and/or use will be found and developed as Green Hydrogen Hubs.
• R&D Projects: The Mission will assist the Strategic Hydrogen Innovation Partnership (SHIP), a public-private partnership structure for research and development. The objectives, deadlines, and magnitude of R&D initiatives shall be appropriate for creating globally competitive technology.
• Skill Development: Under the Mission, a well-coordinated skill-development program will also be implemented.
• Green Hydrogen/Green Ammonia Policy: According to the policy, if the production facility is commissioned before June 2025, the government will establish manufacturing zones for production, prioritize connectivity to the ISTS (Inter-State Transmission System), and provide free transmission for 25 years. (i.e., the manufacturers of green hydrogen/ammonia would be waived off from the inter-state transmission charges for 25 years). Moreover, a single portal for carrying out all the activities including statutory clearances in a time-bound manner will be set up by MNRE to ensure ease of doing business. Furthermore, the manufacturers can avail of many more benefits like storage, Renewable Purchase Obligation (RPO), concessional prices, etc.

Hydrogen Economy Benefits

• Making India the top global producer and supplier of green hydrogen
• Providing green hydrogen and its derivatives with export opportunities
• Less reliance on imported fossil fuels and raw materials
• Improvement of domestic manufacturing capacity
• Generating commercial and investment prospects for the sector
• Providing chances for economic growth and employment
• Supporting R&D initiatives

Mission Implementation Timeline

Energy Security

Energy security refers to ensuring the uninterrupted availability of energy sources at an affordable price. There are two types of energy security:

• Long-term energy security primarily involves making timely investments to supply energy in accordance with environmental needs and prevailing economic factors.
• Short-term energy security is the ability of the energy system to quickly respond to unexpected changes in the supply-demand balance.

 Nations can achieve energy security through a range of robust energy security strategies:

• Exploiting own resources to achieve as close to full self-sufficiency as possible
  Utilizing resources in one's possession to come as near to complete self-sufficiency as possible. With a population of just over 5 million, Norway can utilize its offshore oil and gas fields and hydroelectric power (HEP) resources to supply 96% of its energy demands. It has an excess of energy that it exports to its neighboring countries, such as through an extensive undersea gas pipeline to the UK.
• Supplementing own energy resources with imports from reliable and consistent supplier nations
  The United States and Canada jointly supply power in various regions and are part of the largest integrated energy network in the world. Canada is a net exporter of gas and oil to the United States and an importer of coal from the United States.
• Importing energy from a wide range of suppliers.
  Japan imports Liquid Natural Gas (LNG) from more than five nations, ranging from Indonesia (51%) to the USA (3%), as it has comparatively limited energy resources of its own.
• Switching supply - so there is less dependency on imports
  In the past 20 years, the United States has dramatically decreased its reliance on oil and gas imports from the Middle East and South America by tapping into its own domestic deep onshore shale gas through the controversial practice of hydraulic fracturing, or "fracking".
• Reducing domestic demand for energy
  Increasing home insulation, promoting more cycling instead of driving, and subsidizing solar panels for homes and businesses rooftops can all help with efforts to lessen reliance on foreign energy sources.

Role of Hydrogen in various Sectors

The future of hydrogen energy usage across various high-carbon emitting sectors is as follows:

• Green Steel: In the next ten years, it is anticipated that green hydrogen-based steel will be cost-competitive due to the declining costs of renewable energy and electrolysers. Market restrictions on carbon-intensive steel and the provision of carbon credits are projected to further increase the sustainability of steel made from green hydrogen. Seven out of the ten largest steel-producing nations have declared the launch of green steel projects. Major steel makers have announced their entry into this market.  Sweden leads the way in terms of the concentration of investments in Europe.  Swedish green steel start-up H2GS AB just raised US$ 105 million intending to reach 5 million tonnes of yearly output by 2030.  Tata Steel, an Indian company, has stated that it will use green steel in its UK facilities. 
• Transport:  Hydrogen fuel is used to power fuel cell electric cars (FCEVs), which emit no hazardous gases. Due to its limited operating range, battery electric vehicles (BEVs) may be appropriate for the light passenger car category. In the upcoming years, this advantage of hydrogen fuel cell electric cars is projected to become cost-competitive for heavy-duty vehicles with longer trip ranges, such as buses, lorries, and other commercial vehicles. While lithium and cobalt are imported as raw materials for lithium-ion batteries, which are used in battery electric vehicles (BEVs), the supply chain for hydrogen fuel cells may be completely domesticated, making India Aatmanirbhar in the clean transportation sector.
• Shipping: One of the major industries that are predicted to propel future Green Hydrogen trade and demand is shipping and port operations. By using green hydrogens or their derivatives, such as green ammonia and green methanol, as fuel for propulsion and other operations, maritime transportation and ports have a significant potential to reduce their carbon footprint. The creation of Green Hydrogen/Ammonia refuelling hubs at Indian ports, the creation and use of Green Hydrogen/Ammonia-fuelled vessels, the use of Green Hydrogen/Ammonia to power zero-emission technologies for vehicles and terminal equipment at ports, and the growth of supply chains are all potential prospects. At least two ships will be converted by The Shipping Corporation of India, or in the event of its disinvestment, its successor private organization, to run on Green Hydrogen or other Green Hydrogen produced fuels by 2027. Furthermore, by 2025, green ammonia bunkers and refuelling stations will be built in at least one port. By 2035, PSUs will be required to charter at least one ship each to be powered by Green Hydrogen or derived fuels in 2027, in order to encourage excursions into Hydrogen-powered shipping lines. After that, for each year of the mission, the firms will have to add at least one spacecraft fuelled by green hydrogen or its derivatives.

Upcoming Projects

Some of the prominent conglomerates and state-run industrial players plan to foray into the green hydrogen space:

The Road Ahead
Green Hydrogen is likely to play a critical role in India’s energy transition, particularly in the decarbonization of hard-to-abate sectors. The Green Hydrogen mission is anticipated to speed up the deployment of the Green Hydrogen ecosystem and open new avenues for innovation and financial investment throughout the Green Hydrogen value chain, leading to financial transactions, employment possibilities, and economic expansion. The Government of India's initiatives will jumpstart the procedure and give the market potential in many industries, the needed boost through cost-cutting and economies of scale.