Emerging Green Hydrogen Ecosystem in India

Green hydrogen holds great promise for India’s decarbonization. The government has set ambitious targets and adopted new policies to accelerate the commercialization of this nascent technology. However, production costs of green hydrogen—namely, electrolyzer costs and electricity charges—must fall significantly for it to reach market competitiveness in India. To unlock green hydrogen’s potential, project developers must be able to secure affordable and reliable sources of clean electricity.

RMI’s India Program asked the Capstone team to address challenges in India’s renewable energy market and regulatory system that contribute to high production costs for green hydrogen. After an extensive literature review and expert interviews, the team identified a set of challenges specific to green hydrogen (access to affordable electrolyzers and financing), as well as a set of challenges that are not unique to green hydrogen within the renewable energy system (grid instability, high T&D costs, and access to round-the-clock renewable electricity).

To address these challenges, the team selected and examined country case studies to highlight good practices that could apply to the Indian context. The case studies—Germany/EU, Australia, UAE, Colombia, China, and the US—span a range of regulatory frameworks and economic conditions. Across six geographies, they identified 18 good practices that can address the key challenges mentioned above and facilitate green hydrogen development. Based on these case studies, the team recommended India implement various power sector reforms, subsidies and financial incentives, policy implementation tools, and demand verification methods to enable the growth of the green hydrogen sector in India. Paired with feasibility studies and impact assessments, these recommendations could help India realize its potential as a global hub of green hydrogen production.