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Green Hydrogen: Promising Source of Future Energy Consumption

The energy transition is now a commercial reality that requires improvement. We must immediately switch from the current carbon-based energy systems to green energy systems (Green Hydrogen) that are resource-saving and environmentally sustainable.

Earlier, India declared its intention to grow its non-fossil fuel energy capacity to 500 gigawatts (GW) by 2030 and its intention to achieve net-zero emissions by 2070 at the Glasgow COP26. India needs to concentrate on developing non-fossil power sources, innovative mobility options, and industrial green hydrogen to combat climate change and increase its energy self-sufficiency.

According to a report by the Council on Energy, Environment, and Water and the Centre for Energy Finance (CEEW-CEF), green hydrogen industrial production must reach 7 million metric tonnes per year (MMTPA) by 2040 and 114 MMTPA by 2070 for India to meet its net-zero target. 

The majority of India’s 6 MMTPA of hydrogen production is now grey, produced from natural gas in the fertiliser and refinery sectors. India’s hydrogen demand is predicted to reach 12 MMTPA by 2030, which means green hydrogen will have to supply 80–100% of the new demand.

What is green hydrogen? What distinguishes it from the normal, highly polluting blue and “grey” hydrogen?

Green Hydrogen

Green hydrogen is described as hydrogen created when water is divided into hydrogen and oxygen using renewable electricity. This is a different way from both grey and blue.

Methane (CH4) and steam are frequently separated to produce CO2 (the main driver of climate change) and H2 and grey hydrogen (hydrogen).

Because it is now also produced from coal, which results in significantly higher CO2 emissions per unit of hydrogen produced, grey hydrogen is now more usually referred to as brown or black hydrogen instead of grey hydrogen.

These days, it is produced on an industrial basis, and its emissions are on par with the combined emissions of the UK and Indonesia. For energy transitions, it serves no use at all.

Blue hydrogen uses the additional equipment necessary to capture and store the CO2 formed during the separation of hydrogen from methane, much like grey hydrogen does (or from coal). It is not one color, but rather a very wide gradation because not all of the CO2 created can be captured and not all ways of storing it are equally effective over the long term. The main hypothesis is that a sizable fraction of the CO2 might be captured by significantly decreasing the climate impact of hydrogen generation.

Green Hydrogen Production in India

As was previously said, the price of electrolysers and power heavily influences the price of green hydrogen. Beyond that, there are other expenses such as running costs, fees associated with energy transmission and distribution (T&D), and wheeling charges, in addition to particular local duties and taxes like the goods and services tax (GST) in India. Additional elements that have a significant impact on the supplied cost of hydrogen include the utilisation factor, system design, distance to the demand centre, and supply chain model.

The price of hydrogen produced by electrolysis ranges depending on the technology chosen and the related soft expenses. This makes it challenging to compete with the price of grey or brown hydrogen as it is currently.

Recently, The National Green Hydrogen Mission, with an initial budget of Rs. 19744 crores, has been authorized by the Union Cabinet to assist in the development of demand, production, usage, and export of green hydrogen. 

Green Hydrogen’s role in the effort to achieve net zero

Green hydrogen is a vital part of the energy transition. It is not the next step immediately because we first need to hasten the deployment of renewable electricity to decarbonize existing power systems, hasten the electrification of the energy sector to use affordable renewable electricity, and then hasten the use of green hydrogen to decarbonize difficult-to-electrify sectors like heavy industry, shipping, and aviation.

The fact that we already produce a significant amount of grey hydrogen, which has high CO2 (and methane) emissions, must be emphasized. Start decarbonizing the current hydrogen demand as soon as possible, for example by switching to green ammonia instead of ammonia from natural gas.

Let’s now examine how green hydrogen can help to achieve the objective of net zero.

It can help decarbonize several sectors, including those with difficult-to-reduce emissions like long-distance transportation, chemicals, and iron and steel.

It can help improve the security of the electricity supply and the air quality in cities.

It can make it possible to include fluctuating renewable energy sources into the electrical grid because it is one of the few techniques for storing electricity over days, weeks, or months.

Hydrogen is a crucial element in achieving net-zero emissions by 2050. It can reduce CO2 emissions by up to 60 GB, or 6% of all emissions, between 2021 and 2050.

Opportunities: That India Can Explore Through Green Hydrogen

Hydrogen demand outlook and potential green hydrogen share at cost parity

Manufacturing Opportunities

According to the NITI Aayog Report, by 2030, India plans to have 500 GW of renewable energy capacity. It already boasts one of the most affordable solar and wind rates in the entire world, with a total installed capacity of 118 GW. 

In addition, it is anticipated that the domestic electrolyser market will grow to $5 billion in 2030 and $31 billion in 2050. 

According to RMI’s study, by 2050, India would have a $4 billion market opportunity for fuel cells, which represents 10%–18% of the world’s total fuel cell demand. This could open up chances for domestic production in India, just like electrolysers did. If stationary fuel cell systems are used in the future, the market for fuel cells and manufacturing possibilities could grow much more.

Through the year 2030, there will be a moderate, steady increase in the demand for hydrogen due to a variety of specialised uses in the industrial, transportation, energy, and building sectors.

Cross-sector collaboration will lead to the development of new coalitions for hydrogen project development.

Up to 2030, the cost of manufacturing hydrogen will decrease by around 50%; beyond that, it will continue to do so steadily through 2050, albeit a little more slowly.

By 2050, creating green hydrogen will cost between €1 and €1.5/kg in diverse parts of the Middle East, Africa, Russia, China, the US, and Australia.

In regions with scarce renewable resources, such as much of Europe, Japan, or Korea, production costs will be rough €2/kg throughout the same period, making these markets possible consumers of green hydrogen from other regions.

Even places with good renewable resources but dense populations would import hydrogen because spatial restrictions prevent the production of green electricity for direct use and conversion to hydrogen.

Several significant countries, like the US, Canada, Russia, China, India, and Australia, have zones of both competitive and non-competitive hydrogen production, which may motivate them to foster intranational commerce.

Global hubs for import and export will form, like today’s oil and gas hubs, but with new participants in the nations with abundant renewable energy sources.

We At GH2 Solar

GH2 Solar is a technology-oriented company that has vast experience in executing oil and refineries solar rooftop & large-scale utility projects across India. Being already experienced in the renewable sector, now we are working on the development of “Green Hydrogen” & HAAS (Hydrogen as a Service). If you are planning to adopt Green Hydrogen, you can connect with GH2 Solar to get all information about the same.

For more information, please give us a call at 1800-102-8685

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