Hydrogen Industry Alliance Seeks $360 Million Funding Support From Indian Government

Industry body India Hydrogen Alliance has submitted a proposal for developing green hydrogen hubs and sought government funding of up to $360 million for projects over the next three years.

"The plan seeks to develop first-generation green hydrogen projects, with public finance support of $360 million over the next three years; create a National Hydrogen Development Corporation and a public-private hydrogen taskforce," it said in a statement. It was submitted by the industry alliance to NITI Aayog and the Ministry of New and Renewable Energy on Thursday.

Under the proposal, the body has called for 25 green hydrogen projects to be built by 2025, with an aggregate electrolyser capacity of 150 megawatts. These would be capable of producing 26,000 tonnes of hydrogen annually. Besides, the body also pitched for setting up five national green hydrogen hubs in Gujarat, Karnataka, Maharashtra, Kerala and Andhra Pradesh.

Some of the lead members of the industry body include Reliance Industries Ltd., JSW Steel Ltd., Chart Industries Inc. and the Scotland government.

IH2A has sought $360 million to be used as capital expenditure on electrolysers, auxiliary equipment required in manufacturing, and it includes support through price subsidy of $2 per kg for the 25 projects.

"The 25/25 Plan shows a pathway for India to leverage green hydrogen for industrial decarbonisation in hard-to-abate sectors," said JSW Group's Chief Sustainability Officer Prabodha Acharya. "We will lead by example in the steel and cement sector, by helping build these national hubs."

The proposal was sent a day after India's national policy think-tank Niti Aayog said the government can provide grants for creating green hydrogen corridors in the country. It estimated that hydrogen demand in India could grow fourfold by 2050, and would form almost a tenth of the global demand.

Prime Minister Narendra Modi's government itself is looking to incentivise green hydrogen production in the country as it tries to speed up the shift away from fossil fuels.

Earlier this year, it announced a national hydrogen policy looking to produce 5 million tonnes of green hydrogen annually by 2030. Two of the country's richest industrialists—Gautam Adani and Mukesh Ambani—have announced plans to set up end-to-end green hydrogen supply chains domestically.

The industry body added that public finance support will have to be progressively increased even after the first-generation projects are set up. Between 2025 and 2030, it said the government should target $1 billion of funding for using green hydrogen to decarbonise polluting industries.

"The proposed public spends are a fraction of what other economies are spending," said Amrita Deo, lead secretariat at IH2A. "It benefits government and industry decision-makers so that they can commercialise green hydrogen in a focussed, cost-effective manner."