India's National Green Hydrogen Mission, backed by Rs 19,744 crore of government support over 2023-2030, is gaining significant momentum as major industrial groups including Adani, Reliance Industries, NTPC Green Energy and L&T initiate large-scale green hydrogen production projects. The mission targets 5 million metric tonnes of green hydrogen production annually by 2030, which would make India the second-largest green hydrogen producer globally after China and would position India as a major exporter of green hydrogen to energy-importing economies in Japan, South Korea and Europe that are committed to decarbonisation but lack the renewable energy resources to produce green hydrogen domestically at competitive cost.
Green hydrogen — produced by using renewable electricity to split water molecules through electrolysis — is currently more expensive than grey hydrogen produced from natural gas, but the cost gap is narrowing rapidly as electrolyser technology scales up, renewable electricity costs continue to fall and carbon pricing mechanisms increase the cost of fossil-fuel-derived hydrogen. India's cost advantage derives from its abundant renewable energy resources, which allow solar and wind electricity costs as low as Rs 2.0-2.5 per unit — among the lowest in the world — and its growing domestic electrolyser manufacturing capability that is benefiting from PLI support and the large-scale investment commitments of Adani and Reliance.
Adani New Industries has announced a $50 billion investment plan over the next decade in a fully integrated green hydrogen ecosystem, encompassing solar panel manufacturing, wind turbine manufacturing, electrolyser production, green hydrogen production and downstream offtake through refineries, fertilizer plants and export terminals. The company's first 1 GW electrolyser manufacturing plant is operational in Mundra, Gujarat, making Adani one of the world's largest electrolyser manufacturers. Reliance Industries has separately committed $10 billion to four giga-factories producing solar panels, green hydrogen, fuel cells and advanced batteries as part of its new energy transition strategy centered on the Jamnagar complex in Gujarat.
The demand-side development is equally important for the green hydrogen ecosystem to become commercially viable. India's oil refineries are the largest potential domestic offtake market, currently using 6 million tonnes of grey hydrogen annually for crude oil refining — a portion of which can be substituted by green hydrogen in the near term as cost competitiveness improves. The fertiliser sector, which currently uses natural gas to produce ammonia (the key ingredient in urea), is another large potential market for green hydrogen. The government's strategy of co-locating green hydrogen production near existing industrial hydrogen users — particularly the fertiliser complexes in Gujarat, Rajasthan and Andhra Pradesh — is designed to minimise the transport cost challenge that would otherwise limit economic viability.
India is also investing in the longer-term applications of green hydrogen including green steel production, sustainable aviation fuel and heavy-duty commercial vehicle fuel cells. Tata Steel has signed an MoU with NTPC Green Energy to explore green hydrogen-based direct reduced iron production at its Kalinganagar plant in Odisha — a potential precursor to green steel production that would dramatically reduce the carbon intensity of Indian steel. The government's ambition is for India to become a full-stack green hydrogen nation — producing, using and exporting green hydrogen across the value chain — that combines its manufacturing scale, renewable resource endowment and cost competitiveness to become the global benchmark for green hydrogen economics.
