Green hydrogen: MNRE mulls purchase obligations on fertiliser firms, refineries

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June 17, 2021 1:00 AM

Solar and wind plants can produce green hydrogen through electrolysis, a process wherein the electricity generated is put in water to create hydrogen and oxygen.

The 2.5 million tonne (MT) of crude oil produced in the country during the month was 2.1% lower than the production in the year-ago period. Around 85% of the country’s crude oil requirement has to be imported.The 2.5 million tonne (MT) of crude oil produced in the country during the month was 2.1% lower than the production in the year-ago period. Around 85% of the country’s crude oil requirement has to be imported.

To kick-start a domestic hydrogen eco-system in the country, the Union ministry of new and renewable energy (MNRE) has circulated a draft Cabinet note for inter-ministerial consultation to put green hydrogen consumption obligations on fertiliser producers and petroleum refiners. According to sources, obligations will be imposed on these user industries between FY24 and FY30.

Solar and wind plants can produce green hydrogen through electrolysis, a process wherein the electricity generated is put in water to create hydrogen and oxygen.

The government is looking for ways to increase the penetration of domestic green hydrogen in industries which otherwise import natural gas and ammonia to produce hydrogen. However, given the current high costs and lack of supporting infrastructure, experts have noted that the government has to overcome a number to challenges to pave the way for this new form of energy.

Imported ammonia now costs about $327 per tonne, while ammonia produced from green hydrogen may cost around $600 per tonne for fertiliser plants. It was not immediately clear if MNRE has suggested any provision to reduce the impact of higher costs.

The country currently consumes about 5-6 million tonne of hydrogen annually. MNRE on May 31 has also circulated the draft ‘National Hydrogen Energy Mission’ document for inter-ministerial consultation, aiming to create a hydrogen value-chain in the country and bring down the costs of hydrogen production. According to sources, the government was also planning to use 2,000 mega-watt (MW) solar and wind power capacity for hydrogen production. Apart from industrial use, hydrogen technology can also be used to store electricity and potentially to run vehicles.

Reliance Industries and NASDAQ-listed and global energy player Chart Industries had launched the India H2 Alliance (IH2A) earlier this year to build the hydrogen economy and supply chain in the country. On Wednesday, IH2A said that it has included JSW Steel, CSIR-National Chemicals Laboratory, Scottish Development International and think tanks — TERI, CEEW and WRI India — as its members.

State-run power generator NTPC has signed an MoU with Siemens for green hydrogen production from the company’s renewable energy plants. Indian Oil Corporation is also in the process of setting up hydrogen production plants in its refineries, and operate 15 hydrogen fuel cell buses in Delhi NCR region.

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