India's Hydrogen Alliance Proposes 100% HPO for New Plants by 2030
Key Ideas
  • India Hydrogen Alliance suggests 10% HPO for existing plants and 100% HPO for new refineries and ammonia plants by 2030 to meet the NGHM 2030 target.
  • The proposal aims to replace grey hydrogen with green hydrogen, potentially reducing carbon emissions in the refinery and ammonia sectors.
  • Introduction of HPOs could help in aggregating demand and supporting $80 billion hydrogen-related investments in India.
  • IH2A recommends a Japan Contract-for-Difference framework to part-fund the green hydrogen transition and meet the 2030 targets.
The India Hydrogen Alliance (IH2A) has formally proposed to the Government of India the implementation of hydrogen purchase obligations (HPOs) to drive the adoption of green hydrogen in the country. The proposal suggests a 10 per cent HPO for existing plants and a 100 per cent HPO for new refineries and ammonia plants by 2030 to achieve the National Green Hydrogen Mission (NGHM) 2030 target of 1.5 million tonnes of green hydrogen for domestic consumption. IH2A emphasized that without the mandated HPOs and sufficient demand creation, the NGHM 2030 targets and combined hydrogen-related investments worth $80 billion could be at risk. The alliance aims to transition from grey hydrogen to green hydrogen, especially in the refinery and ammonia sectors across 47 existing and proposed plants in India. The introduction of HPOs is viewed as a way to replicate the success of Renewable Purchase Obligations (RPOs) in the renewable energy sector. IH2A believes that the proposed HPOs could help aggregate demand, support investments, and reduce carbon emissions in the hard-to-abate refinery and ammonia industries. IH2A's Secretariat lead, Amrit Singh Deo, highlighted the need for a common hydrogen use and demand roadmap for refineries and fertilizers to ensure the procurement of green hydrogen volumes. The alliance also suggested a Japan Contract-for-Difference (CfD) framework to finance the green hydrogen transition and reduce carbon emissions. To facilitate the transition, IH2A recommended an additional budget allocation for a $2 billion CfD framework, supporting both existing and new plants to achieve the envisioned HPO offtake percentages by 2030. The proposed measures aim to accelerate India's shift towards green hydrogen and achieve its ambitious targets in the hydrogen space.
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