India wants to be the cheapest hydrogen producer in the world, so it has extended a waiver of transmission fees for renewable power to hydrogen production facilities that are commissioned before January 2031, a government official said.
The action is anticipated to reduce the price of green hydrogen, which is created by splitting water with power generated from renewable sources, by a fifth. According to the source, who declined to be named because he was not authorised to speak to the media, the change will allow more green hydrogen production projects to be eligible for the 25-year remission of transmission rates, which was previously available for facilities set up before July 2025.
According to the government official, it was unlikely that many large-scale hydrogen and ammonia projects would be completed by June 2025 because they require three to four years to build.
The country wants to create green hydrogen for $1–1.50 per kilogramme, which would be far less expensive than the current $4–5 per kilogramme global average. By 2030, Reliance Industries and Adani Enteprises want their costs to be $1 per kilogramme. Other well-known Indian businesses that have made plans to produce green hydrogen include Larsen & Toubro, Indian Oil, NTPC, JSW Energy, ReNew Power, and Acme Solar.
According to estimates from the industry, 65%–70% of the cost of manufacturing green hydrogen comes from renewable energy, including transmission. For transmitted unit of power, interstate transmission costs range from 1-2 rupees. Green hydrogen costs 60 Indian rupees ($0.73) less for every rupee that renewable energy costs decrease, according to the official.
8 trillion Indian rupees ($98 billion) in investments are expected to be needed by 2030 for India’s hydrogen mission, including 125 gigawatts of non-fossil fuel production capacity and new transmission lines. In addition, India intends to provide incentives to green hydrogen producers worth at least 10% of their costs as part of a $2 billion programme that will start before the end of June.
According to the Power and Renewable Energy Minister R K Singh, the nation opposes expanding the definition of green hydrogen to include fuel derived from low carbon energy, as several wealthy nations have suggested in G20 meetings.
