One of the most important aspects of Indian Prime Minister Narendra Modi speech on India’s Independence Day on August 15, 2021, was a thrust on pushing for green energy. The Indian PM stated that the aim is to make the country a “green hydrogen” hub which will allow India to make a quantum leap forward. Similar to its renewable energy programme, India’s goal will be to use a scale to promote its ambitious green hydrogen strategy, resulting in the country having the world’s largest clean energy programme.

The government plans to implement the Green Hydrogen Consumption Obligation (GHCO) in fertilizer manufacturing and petroleum refining, similar to the Renewable Purchase Obligations (RPO). RPOs compel power distribution firms to buy a certain quantity of renewable energy in order to minimize their reliance on fossil fuels. India’s overall hydrogen demand is expected to rise to 11.7 million tonnes (mt) by 2029-30, up from 6.7 million tonnes (mt) at present. This comes at a time when India’s domestic oil and gas production is falling. Domestic crude and oil and gas output fell 5.22 percent and 8.06 percent, respectively, from April 2020 to March 2021, as compared to the same time the previous financial year.

The current cost of green hydrogen produced through electrolysis is expected to be above 350 dollars per kilogram, but by 2029-30, the goal is to reduce it to around 160 dollars per kilogram. The government also intends to expand the production-linked incentive (PLI) programme for electrolyzer manufacturers interested in producing green hydrogen. Green hydrogen is created by splitting water into hydrogen and oxygen in an electrolyzer that is powered by renewable energy sources such as wind and solar.

Modi went on to explain that Indian Railways has set a goal of becoming carbon-neutral by 2030. He went on to remark that the government was focusing on a circular economy to accomplish its environmental goals, mentioning initiatives such as the new automotive scrappage legislation as examples.

India’s campaign for renewable energy has paid off, with the country surpassing the 100 gigawatts (GW) mark in installed capacity. Given India’s entire installed power-producing capacity of 383.73 GW, this is significant. While India has resisted the push to declare a net-zero emission goal and to call out countries for making carbon-neutral declarations, its green energy trajectory has been improving.

India is now ranked fourth in the world in terms of installed renewable energy capacity, fifth in solar, and fourth in wind. In the face of rising electricity consumption, investors’ interest in India’s green economy continues to expand. India is in charge of the world’s largest clean energy initiative. On July 27, solar and wind generation reached an all-time high of 43.1GW, reaffirming India’s push for renewable energy sources. Despite having one-third of the world’s per capita emissions, India has been increasing its green portfolio. India is on track to reach its Nationally Determined Contributions targets for non-fossil fuel electricity generation and emission reductions. While 100 GW has been deployed, another 50 GW is being installed, and another 27 GW is being tenderized. India’s goal of installing 450 GW of renewable energy capacity by 2030 has been raised. When large hydro is factored in, the total installed RE capacity rises to 146 GW.

This comes as the UN’s Intergovernmental Panel on Climate Change (IPCC) predicts that extreme weather occurrences in India and South Asia will have an impact on people’s lives, livelihoods, and businesses.

The Union government has proposed new laws for the purchase and use of green energy, including waste-to-energy plant energy, titled “Draft Electricity (Promoting Renewable Energy through Green Energy Open Access) Rules, 2021.” The proposed guidelines aim to encourage the faster adoption of renewable energy by resolving a number of issues that have arisen in the green energy sector. On August 16, the Union Power Ministry published the rules online and requested opinions from all parties within 30 days. Green energy is defined in the proposed rules as electrical energy generated from renewable sources for customers, including industries with a load of 100 kW or higher.

The Renewable Acquire Obligation is a mechanism established by the Electricity Act of 2003 that requires large users to purchase a specific percentage of their total electricity consumption from renewable sources. “Any entity (whether obligated or not) may elect to purchase and consume renewable energy as per their requirements,” according to the draft rules, whether through own generation from renewable energy sources, procuring renewable energy through open access from any developer, purchasing renewable energy certificates, or purchasing green hydrogen. The tariff for green energy will be determined by the appropriate Commission and will include the average pooled power purchase cost of renewable energy, cross-subsidy charges (if any), and service charges that cover all prudent costs of the distribution licensee for providing green energy, according to the draft rules.

The draft guidelines from the electricity ministry are a “welcome move for renewables in the country,” according to Subrahmanyam Pulipaka, the Chief Executive Officer of the National Solar Energy Federation of India, which is India’s umbrella organization for all solar energy stakeholders. If properly implemented, they will give much-needed assistance for the expansion of renewables in order to meet the 2030 target, according to Pulipaka.

By Dr. Ankit Srivastava

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