India has recently presented its Hydrogen Strategy. Hydrogen is to play a greater role in the Indian energy mix. Politicians and industry see potential applications above all in the transport sector.
India’s energy mix is dominated by fossil fuels. Of the total 370 gigawatts of installed power generation capacity, 56 percent is coal and 7 percent gas. However, the share of renewable energies is set to grow: whereas at the end of the 2019/20 financial year (1 April to 31 March) the figure was 87 gigawatts, the Indian government plans to expand the capacity of wind, solar, biomass and small hydroelectric power plants to 175 gigawatts by 2022 and to 455 gigawatts by 2030.
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However, the expansion of renewable energies had already slowed down before the corona crisis due to the economic situation and is now being further slowed down in the wake of the pandemic. Although this means that capacity targets are being postponed, in the long term India is holding its course in expanding wind, solar and bioenergy. India also wants to examine the use of hydrogen as an energy carrier or storage medium. The country is still at the very beginning in this respect, but sees the technology as an important piece in the mosaic of its energy strategy.
Hydrogen as part of the energy strategy
The Indian government had already given the starting signal for the hydrogen economy in 2008 with its National Hydrogen Energy Roadmap and set itself ambitious targets. Among other things, decentralized power generation capacities from hydrogen with a capacity of 1,000 megawatts and 1 million hydrogen-powered vehicles should be on India’s roads by 2020. However, despite initial support from industry – the driving forces were the conglomerates Tata and Mahindra – the topic was not advanced any further.
Blending of hydrogen with CNG
In 2018, the state think tank NITI Aayog prepared a study on the use of clean fuels (Clean Fuel) and recommended the use of hydrogen in the transport sector. The main focus is on the blending of hydrogen with the widely used Compressed Natural Gas (CNG). There are 3.5 million CNG vehicles registered in India. However, the country has to import the majority of its natural gas and its consumption is expected to quadruple to 200 million tons per year by 2030, according to estimates by the regulatory authority for the gas and oil industry.
The hydrogen-CNG mixture could reduce CO2 emissions from road traffic and reduce dependence on natural gas imports, according to NITI Aayog. The state-owned oil company Indian Oil Corporation (IOCL) has conducted studies in 2017 with the automotive association SIAM and the commercial vehicle divisions of carmakers Tata Motors and Ashok Leyland. When blended with CNG at 18 percent, CO2 emissions were reduced, but nitrogen oxide emissions increased. In addition, the mixture is significantly more expensive than pure CNG.
Price of green hydrogen to fall
IOCL is interested in hydrogen production by electrolysis with favourable excess coal flow. Green hydrogen is also considered an option, at least in the long term. However, India is still a long way from economic production of hydrogen, according to BloombergNEF. For example, the production costs for green hydrogen from renewable energies should be 1.17 US dollars (US$) per kilogram in 2030 and fall to 0.76 US$ by 2050 – the price of natural gas was 0.77 US$ per kilogram in 2019. Since India is one of the world’s largest emitters of methane, the production of turquoise hydrogen would also be conceivable.
The National Hydrogen Mission should clarify which path India will take in the hydrogen economy. This is currently being prepared by the Ministry of New and Renewable Energy (MNRE) and is to be presented in 2020