Hydrogen Hubs in India: Recent Regulatory Developments

The Ministry of New & Renewable Energy (MNRE) came up with the National Green Hydrogen Mission (NGHM) in January 2023, which aimed: "to provide a comprehensive action plan for establishing a Green Hydrogen ecosystem and catalysing a systemic response to the opportunities and challenges of this sunrise sector." The NGHM recognised India's Net Zero Target of 2070 but also underscored another important but relatively less talked about target: Energy Independence by 2047. The NGHM stated that green hydrogen was seen as playing a critical role in achieving these objectives.

For the uninitiated green hydrogen refers to hydrogen produced by electrolysis using renewable energy. There are other types of hydrogen depending on the emission the process of manufacture gives out. See here, for information on such other types of hydrogen. 

Hydrogen Hubs in the NGHM

The NGHM recognises that transportation of hydrogen would be a challenge, both technically and logistically, and therefore provides for cluster production, which would have the following features:

• Large scale production in a given area;
• Utilisation of the produced hydrogen also in the given area;

The NGHM contemplates development of clusters where there are refineries/ fertilizer plants and where pilot projects for application of hydrogen in areas such as steel production, ports development, mobility, etc. would be promoted.

The Mission also contemplates infrastructure for storage and deliver of green hydrogen, port infrastructure for export of derivatives of green hydrogen, pipelines for bulk transportation, coordinated financing, etc.

Scheme for Setting up Hydrogen Hubs, 2024

Further to the Mission, MNRE recently came up with a Scheme for setting up of hydrogen hubs with the following objectives:

"(i) To identify and develop regions capable of supporting large-scale production and/or utilization of Hydrogen as Green Hydrogen Hubs. 

(ii) Development of Green Hydrogen Projects inside the Hubs in an integrated manner to allow pooling of resources and achievement of scale 

(iii) Enhance the cost-competitiveness of Green Hydrogen and its derivatives vis-a-vis fossil-based alternatives 

(iv) Maximize production of Green Hydrogen and its derivatives in India within the stated financial support 

(v) Encourage large-scale utilization and exports of Green Hydrogen and its derivatives 

(vi) Enhance viability of Green Hydrogen assets across the value chain." (Para 3)

The Scheme contemplates the core infrastructure in hydrogen hubs, including Storage and transportation facilities for Green Hydrogen/its derivatives, Development/ upgradation of pipeline infrastructure, Green Hydrogen powered vehicle re-fuelling facility, Hydrogen compression and/or liquefaction technologies, as required, and so on (Para 2). 

The Scheme recognises the plan to set up two hydrogen hubs by 2025-26 and a budget outlay of about Rs. 200 crores.

Features of Hydrogen Hub under the Scheme

 

The Scheme contemplates a hydrogen hub with the following salient features:

• Hydrogen hubs will cater to domestic demand as well as to exports
• The hub will have a network of producers, users and supporting infrastructure
• Development of hydrogen infrastructure would have to be done in a coordinated manner and by pooling resources from the Central Govt., State Govt., Local Govt. and the industry
• A hydrogen hub should have a planned/announced capacity of a minimum of 1,00,000 MTPA. Higher production capacity would get more priority under the Scheme.
• Infrastructure, projects and resources would be mapped under the PM Gati Shakti.
• Recognition of hydrogen hubs by MNRE in other places is possible but without financial assistance.

Evaluation Criteria for Proposals

The Scheme recognises that detailed evaluation criteria would be provided in the Call for Proposals and would be based on the following:

Funding

Rs. 100 crores (Central Financial Assistance) per hydrogen hub would be allocated in order to support core infrastructure in the following manner and would be released on the basis of conditions detailed in the Call for Proposals:

Provisions regarding failure to utilise grants or complete the project would be mentioned in the Call for Proposals.

A Steering Committee (overall monitoring of scheme) and a Project Appraisal Committee (project review) will be constituted. MNRE would nominate Scheme Implementing Agencies (SIAs) to implement the Scheme and hydrogen hubs.

Comments

It would be interesting to see how the Call for Proposals shape up and how hydrogen hubs would be created. The timelines contemplated (2025-26) is very tight. Interesting times ahead for renewables and energy security in India.