Green Hydrogen Policy: All About It, Whom Will It Help Etc.

First part of the green hydrogen policy has been launched on Thursday evening by the power ministry. This is indeed called a first step towards the National Hydrogen Mission. So, to bring clarity on what it is, here is everything in brief:

Green Hydrogen Policy:

As per the policy this is to provide a boost to the manufacture of green hydrogen. And from a broader perspective will help the centre meet its climate goals and make a green hydrogen hub. " This will help in meeting the target of production of 5 million tonnes of Green hydrogen by 2030 and the related development of renewable energy capacity", said the press release.

What is Green Hydrogen?

Green hydrogen or more environmentally friendly hydrogen is produced through a process called electrolysis in which renewable energy is used. Here an electrical current is applied to separate hydrogen from oxygen in water. Now in the process if the electricity i.e. made use of is generated using renewable sources including solar or wind then the production of hydrogen in this way emits no greenhouse gases.

Now this fuel is said to be highly environmentally friendly as when it is burnt it produces water.

Sops provided in the Nations Green hydrogen policy and whom shall it benefit

Green Hydrogen / Ammonia manufacturers may purchase renewable power from the power exchange or set up renewable energy capacity themselves or through any other, developer, anywhere.

Open access will be granted within 15 days of receipt of application. The Green Hydrogen / Ammonia manufacturer can bank his unconsumed renewable power, up to 30 days, with distribution company and take it back when required. 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.

Waiver of inter-state transmission charges for a period of 25 years will be allowed to the manufacturers of Green Hydrogen and Green Ammonia for the projects commissioned before 30th June 2025. The manufacturers of Green Hydrogen / Ammonia and the renewable energy plant shall be given connectivity to the grid on priority basis to avoid any procedural delays. The benefit of Renewable Purchase Obligation (RPO) will be granted incentive to the hydrogen/Ammonia manufacturer and the Distribution licensee for consumption of renewable power.

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 MNRE. Connectivity, at the generation end and the Green Hydrogen / Green Ammonia manufacturing end, to the ISTS for Renewable Energy capacity set up for the purpose of manufacturing Green Hydrogen / Green Ammonia shall be granted on priority. Manufacturers of Green Hydrogen / Green Ammonia shall be allowed to set up bunkers near Ports for storage of Green Ammonia 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 implementation of this Policy will provide clean fuel to the common people of the country. This will reduce dependence on fossil fuel and also reduce crude oil imports. The objective also is for our country to emerge as an export Hub for Green Hydrogen and Green Ammonia. The policy promotes Renewable Energy (RE) generation as RE will be the basic ingredient in making green hydrogen. This in turn will help in meeting the international commitments for clean energy.

Beneficiaries of Green Hydrogen Policy

All of the players in the sector including Adani Enterprises, Reliance Industries,ReNew Power and others will be able to utilise their existing green energy capacities for producing green fuels. All of these companies have been engaging in green energy in some way or the other and are expanding their capacities.

Industry reaction on Green Hydrogen Policy

Mayank Bansal, Chief Commercial Officer, ReNew Power, said, "Currently, manufacturing green hydrogen is a costly proposition. The government has correctly waived off ISTS (inter-state transmission charges) for a period of 25 years, which will help bring down the cost of green hydrogen. Further, the decision to include biomass as a fuel for generation of green hydrogen is a step in the right direction."

"We specifically welcome the provisions to set up bunkers near ports for export of green ammonia,'' said Manoj K Upadhyay, founder and chairman, ACME Group. It will be important to build upon the first phase, he said, adding that the government must subsequently come up with policy measures for initial demand creation through mandatory green hydrogen and ammonia purchase obligations.

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