Green Hydrogen and Green Ammonia Policy

Context

• The Centre recently notified the green hydrogen and green ammonia policy aimed at boosting the domestic production of green hydrogen to 5 million tonnes by 2030 and making India an export hub for the clean fuel.

What is green hydrogen?

• Green hydrogen is hydrogen gas produced through electrolysis of water an energy intensive process for splitting water into hydrogen and oxygen using renewable power to achieve this.

About Green Hydrogen and Green Ammonia Policy

1. 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.
2. Open access will be granted within 15 days of receipt of application.
3. The Green Hydrogen / Ammonia manufacturer can bank his unconsumed renewable power, up to 30 days, with distribution company and take it back when required.
4. 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.

   

5. 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.
6. 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.
7. 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.
8. 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.
9. 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.
10. 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.

Significance of the Green Hydrogen and Green Ammonia Policy

• 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.

What are the facilities to boost export of green hydrogen and ammonia?

• Under the policy port authorities will also provide land at applicable charges to green hydrogen and green ammonia producers to set up bunkers near ports for storage prior to export.
• Germany and Japan could be key markets for green hydrogen produced in India.

What next?

• The government is set to come out with mandates requiring that the oil refining, fertiliser and steel sectors procure green hydrogen and green ammonia for a certain proportion of their requirements.
• The mandate for the refining sector could start at 15-20 per cent of the sectors total requirement.

Back to basics

Hydrogen or ammonia

• They are produced mostly by steam reformation with natural gas and sometimes by electrolysis, which is splitting water with electricity yielding hydrogen and oxygen.
• The power to execute both of these methods is sourced from hydrocarbons or natural gas.
• Green hydrogen results when the electricity is produced from a non-fossil fuel source such as solar or wind energy but this is currently uneconomical and the new policy aims to make this more viable.

Source: PIB & IE

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