India’s hydrogen plan percolates
Deployment, electrolyzer cost reduction, and supply chain logistics are likely to be the key components of India's "National Hydrogen Mission," when the game plan is released in the middle of 2021, observers say.
The 2021 national budget released in February outlined India's intentions to confront the challenges arising from the energy transition the country has embarked on.
At the 2015 UN Climate Change Conference in Paris (COP21), the Indian government committed to generating about 40% of its electricity from non-fossil fuel sources by 2030.
While the budget refers to releasing a hydrogen mission plan this year, the roadmap has not been made public and neither is the timeline of release clear, said Ashish Singla, associate director, climate and sustainability, South Asia power and renewable, IHS Markit at Gurgaon, India.
India's focus on hydrogen-related developments in the past decade largely involved research and development, specifically on the technology supporting hydrogen development as opposed to wide-scale deployment plans, according to Singla. The hydrogen mission plan is expected to focus on deployment, electrolyzer cost reduction, and improving supply chain logistics, he said.
The International Energy Agency (IEA), in a document published in 2019 titled, "Hydrogen: A Renewable Energy Perspective," said that deployment and "learning-by-doing" to reduce electrolyzer costs and supply chain logistics should be the main concerns of any countries looking to use hydrogen as a form of renewable energy, but all these will require funding. The IEA also said policymakers should consider a legal framework that facilitates "hydrogen-based sector coupling."
"Such a framework would be key to the effective use of infrastructure, helping gain volumes while ensuring cost effectiveness," Singla said. He expects to see India develop a legislative framework this year that would facilitate large-scale deployment of hydrogen as well as commercialization.
One of the focuses of the mission is producing hydrogen from renewable power sources, creating green hydrogen. The objective, according to Singla, is to decarbonize, as the use of fossil fuels may defeat the overall purpose of developing a hydrogen economy.
But there are challenges in generating hydrogen from green sources, one of which is the source of the hydrogen itself, Singla said. "Generating hydrogen via electrolysis of water is too expensive to be competitive compared with other options without an appropriate carbon price," he said.
There are many different sources of the molecules for hydrogen and methods for producing them. Steam-methane reforming is the most common method for producing hydrogen commercially. Electrolysis is essentially splitting water using electricity, and the electricity used for green hydrogen can come from renewable sources such as hydro, solar, or wind energy.
According to IEA, electrolyzers are scaling up quickly from megawatt to gigawatt, as technology continues to evolve but there have been no major breakthroughs. But the projected decline in both electrolyzer costs — which are expected to halve from $840/kW today by 2040 to 2050 — and renewable electricity costs will make renewable hydrogen the cheapest clean energy option for many greenfield applications, IEA wrote.
Capital expenditure for polymer electrolyte membrane electrolyzers will fall by 60%, with the reduction in capex primarily from achieving scale, said Alex Klaessig, research and analysis director at IHS Markit in Boston, adding that research and development efforts on the supply chain will lower costs as well. "A combination of slight improvements on things like platinum group metal loadings will add up over time. In addition, the efficiency will also come up as we improve thermal management, catalyst operation, etc.," he said.
Other methods of producing hydrogen are being researched and these include using microbes that use light to make hydrogen, converting biomass into gas or liquids and separating the hydrogen, and using solar energy technology to split hydrogen from water molecules, according to the US Energy Information Administration.
Demand for hydrogen
Demand for hydrogen in India today is about 6 mt/year and comes mainly from industrial sectors such as fertilizers and refineries, according to IHS Markit. These sectors will continue to make up a large part of the demand with volumes, expected to surge, with new demand coming from the steel industry as it seeks to decarbonize, Singla said.
"Hydrogen will have a role to play in the transport sector, particularly in heavy-duty and long-distance segments, and a minor role in the power sector as a long-term storage vector," he added.
One of the uses of hydrogen could be as an energy storage option, if hydrogen-powered fuel cells could be used to mitigate the intermittency of renewable power. While theoretically possible, Singla said demonstration projects need to be undertaken to highlight any additional operational and financial challenges this might pose.
A number of collaborations between Indian and international companies have been underway since last year in the space.
In November 2020, India's Adani Group and Italy-based Snam, a gas infrastructure company, teamed up to explore the hydrogen value chain in India and the international markets. The two companies will also develop biogas, biomethane, and low-carbon mobility in India.
In a separate partnership, Adani Group, through Adani Enterprises, signed a memorandum of understanding with NextChem, Stamicarbon, and MET Development, subsidiaries of Milan-listed Maire Tecnimont, on 22 March, to industrialize green chemistry, focusing on producing chemicals, ammonia, and hydrogen from renewable feedstocks.
More recently, India's Reliance Industries and US technology and equipment provider Chart Industries formed the India H2 Alliance to commercialize hydrogen technology and systems, as well as creating a hydrogen value chain and economy in India. The aim is to bring down the cost of hydrogen production and to help India achieve its net-zero carbon ambitions, the partners said in a joint statement 6 April.
"The India H2 Alliance will work together to […] help develop blue and green hydrogen production and storage as well as build hydrogen-use industrial clusters and transport use-cases with hydrogen-powered fuel cells," they said.
The coalition will work with the Indian government on five areas: developing a national hydrogen policy and roadmap during 2021-2030; creating a national hydrogen taskforce involving public-private partnership; identifying large hydrogen projects at the demonstration phase; creating a national hydrogen fund; and creating capacity covering production, storage, and distribution of hydrogen. Industrial sectors - specifically steel, refineries, fertilizer, cement, ports and logistics, and heavy-duty transportation -- will be among the focuses of the India H2 Alliance. It will also set up standards for storage and transportation of hydrogen in pressurized and liquified form.
Some industry sources said India's hydrogen energy mission could help boost renewable energy infrastructure across the country, but Singla does not expect this to happen until 2035, depending on the maturity of chemical storage. "It is important to note that current chemical storage can only be utilized for intra-day firming up of renewables. However, as the penetration of renewable increases, inter-day, inter-week, inter-month storage would be required. For this, chemical storage might prove an expensive option based on the current level of prices," he said.
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