Financial Strategies for Green Hydrogen in India: Balancing Risk and Reward
Key Ideas
- The report by CEEW highlights the financial challenges and early-stage risks associated with green hydrogen production in India.
- It recommends targeted subsidies, viability gap funding, and other fiscal mechanisms to lower production costs and attract investments.
- The report emphasizes the importance of public investment in the initial stages due to high costs and low demand.
- It calls for a coordinated approach to policy design to reduce risks for early adopters, align with emission reduction goals, and attract private funding.
The report by Council on Energy, Environment and Water (CEEW) focuses on the financial aspects of green hydrogen production in India. It points out the high costs and risks involved in the early stages of adopting green hydrogen technologies. The report suggests that to make green hydrogen economically viable, targeted subsidies and viability gap funding are necessary to bring down production costs. It emphasizes that significant public investment is crucial in the initial stages due to the high costs and limited market demand. The report also identifies the need for a more cohesive and coordinated financial support system across various sectors to bridge the gaps in the current policy frameworks. It advocates for an integrated policy approach that not only reduces risks for early movers but also aligns with the emission reduction targets set by the government. By providing predictable and outcome-based support, the report aims to attract private investments in the green hydrogen sector. Overall, the report underscores the importance of strategic financial interventions to promote the adoption of green hydrogen technologies in India.