Indian demand for hydrogen to increase fivefold by 2050

Hydrogen demand in India could increase by at least five-fold by 2050, according a new report from The Energy and Resources Institute (TERI).

The report from the independent research organisation also estimates that by 2030 the costs of hydrogen from renewables in India will fall by more than 50% and will start to compete on cost terms with hydrogen produced from fossil fuels.

Hydrogen demand in India is currently around 6 million tonnes per annum, with the main uses in regard to ammonia for agricultural fertilisers and methanol for refineries. By 2050, this could increase to around 28 million tonnes, as a result of increased demand from expansion into the transport and power sectors, according to the report.

The report states that although several leaders are emerging in the hydrogen production market, including Japan, the European Union and China, a window of opportunity still remains for India to capture large parts of this market.

Factors in India’s favour include a large domestic market, the increasing competitiveness of hydrogen as a product, and the country’s continuing low-cost of labour.

By 2040, hydrogen could even become cost-effective for providing long-duration storage as part of a broader renewable electricity system. Prior to this date the need will be minimal as the wind and solar generation necessary to facilitate this shift is unlikely to reach sufficient capacity.

In the Indian transport sector, battery electric vehicles, given improvements in battery technologies, are likely to dominate smaller, shorter-range passenger vehicles over the medium term. However, hydrogen technology could play a role in long distance and heavy duty vehicles.

However, a step-change in government policy and business actions is required to accelerate the adoption of hydrogen technologies in India, according to TERI. This includes greater cross-sector coordination within the government and a shift from early-stage R&D programmes towards later-stage commercial support.

India should also be proactive in manufacturing electrolysers to produce green hydrogen, it suggests, urging the government to set targets for electrolyser deployment by 2030 and facilitate companies to establish electrolyser manufacturing facilities in India.

To ensure that low carbon hydrogen is favoured over high emission alternatives, an emissions penalty could also be introduced at some stage, either in the form of more stringent regulations or a carbon tax.

Green product standards also should be introduced.

“The falling cost of hydrogen will drive its uptake, with initial scale-up being driven by collaborations between progressive public and private players,” said Dr Ajay Mathur, Director General of TERI.

“India has an opportunity to grow an economically competitive low carbon hydrogen sector that can spur job growth reduce energy imports, whilst drastically reducing emissions.”

The report estimates that with the scale-up of domestic green hydrogen use, annual energy imports could be reduced by around 120 million tonnes – around 20% of current consumption levels – with cost savings of Rs.50,000 Cr ($20 billion).

Hydrogen demand in India is currently around 6 million tonnes per annum, with the main uses in regard to ammonia for agricultural fertilisers and methanol for refineries. By 2050, this could increase to around 28 million tonnes, as a result of increased demand from expansion into the transport and power sectors, according to the report.

SHARE: