Government may provide for targeted financial incentives and allocation of funds to promote green hydrogen in the country Union Budget 2022-23, which is to be unveiled in Parliament.
government launched National Hydrogen Mission in 2021. Earlier this month, the Minister of Power and New and Renewable Energy RK Singh had indicated that a green hydrogen policy would be unveiled in February which would include several incentives to promote green hydrogen in the country.
“While 2021 saw the launch of the National Hydrogen Mission, it is likely that the budget could provide targeted financial incentives for R&D in the green hydrogen segment, building a domestic supply chain for hydrogen, and promoting green hydrogen production.” may reduce customs duty on electrolysers to promote.” They say Venkatesh Raman Prasad, Partner, J. Sagar Associates (JSA).
Prasad’s view that India’s commitment at COP 26 to achieve net zero emissions by 2070 and meet 50 per cent energy requirements from renewable energy by 2030 reflects the government’s intention to focus on clean sources of energy.
Hemant Mallya, Senior Program Lead, Council on Energy, Environment and Water (CEEW) believes that green hydrogen has many industrial uses and can potentially decarbonize many hard-to-absorb sectors such as iron and steel industries. Huh.
He says the upcoming budget outlay of Rs 1,200 crore by 2024 could trigger pilots in various end-use applications such as testing of green hydrogen readiness of natural gas pipelines, underground hydrogen storage, and for equipment such as furnaces, boilers Pilot. Process heater.
They suggest another Rs 165 crore could support R&D, especially on catalyst and electrolyzer membranes, on finding alternatives to critical minerals, setting up testing labs and implementing safety standards.
They believe that these investments will help to indigenously produce green hydrogen and use it as an industrial fuel.
Davinder Sandhu, co-founder and president, Primus Partners, says that electrolysers currently manufacturing hydrogen are expensive and reducing their cost will contribute to reducing the cost of green hydrogen.
This will enable the country to meet the target of setting up 10 GW of domestic manufacturing capacity as well as make India a global leader in the sector, he believes.
In this regard, he suggests that the government should consider a Production Linked Incentive (PLI) scheme which can help in indigenization of electrolyzers and increase green hydrogen production at optimized cost.
Earlier this month, Union Minister RK Singh had said that a new green hydrogen policy would include free electricity transmission for 25 years, dollar-denominated bids, offering land in renewable energy parks and building bunkers for green hydrogen or ammonia. This would include incentives such as land allotment near ports.
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