Green Hydrogen

1. At a Glance

• Green hydrogen is hydrogen produced by electrolysis of water using renewable electricity (solar/wind). Hydrogen is an energy carrier, not a primary energy source. In a fuel cell it gives electricity, with only water and heat as by-products [1].
• It matters most for hard-to-abate sectors: fertiliser, refining, steel, heavy transport and shipping. These need high-temperature heat or chemical processes, and direct electrification is difficult there [1].
• India's NGHM (MNRE, approved January 2023, outlay ₹19,744 crore) aims to make India a global hub for green hydrogen and its derivatives. It supports net-zero by 2070 and energy security [1][2].
• For the exam it combines science (electrolysis), economics (cost and auctions), environment (decarbonisation) and policy (SIGHT, the Standard, certification), so it is tested in both Prelims and Mains (GS-III).

2. Why in the News

• Bharat RE Summit 2026 (2–5 November 2026) brought green hydrogen and NGHM back into focus [1].
• India's first hydrogen train was flagged off on the Jind–Sonipat section (Northern Railway) on 17 July 2026 [6].
• Record-low green ammonia prices were discovered in SECI auctions under SIGHT in 2025 [3][9].

3. Background & Evolution

• Rationale: fossil-based hydrogen routes emit carbon. India's solar and wind resources make the electrolysis route viable for decarbonisation and energy security [1].
• 2021: IROAF (Indian Railways Organisation of Alternative Fuels) invited bids for a hydrogen fuel-cell train on the 89 km Sonipat–Jind section [8].
• January 2023: the Union Cabinet approved NGHM with an outlay of ₹19,744 crore, including ₹17,490 crore for SIGHT [2][4].
• August 2023: MNRE notified the Green Hydrogen Standard, with a ceiling of 2 kg CO₂e per kg H₂ [1].
• 2024: SECI issued an RfS for selecting green ammonia producers under SIGHT [11].
• April 2025: the Green Hydrogen Certification Scheme of India was launched, with BEE as the accreditation body [1].
• August 2025: SECI held its first-ever green ammonia auction at ₹55.75/kg [3].
• July 2026: the hydrogen train began operating between Jind and Sonipat [6].

4. Core Static Facts

Key terms

• Electrolysis: 2H₂O → 2H₂ + O₂. Hydrogen forms at the cathode and oxygen at the anode. A diaphragm separates the gases, and the electrolyte carries ions [1].
• Derivatives: green ammonia is used for fertiliser (urea). Green methanol and green ammonia are used for shipping [1].
• DRI (Direct Reduced Iron): hydrogen replaces coal as the reductant, so the process releases water vapour instead of CO₂ [1].
• Open Access: producers can buy renewable power from sources other than their local DISCOM. Banking: surplus power is stored as a credit for later use [1].

5. Multi-Dimensional Analysis

Economic

• Green ammonia auction prices of ₹49.75–₹64.74/kg show costs are falling [9]. That compares with ₹100.28/kg in the 2024 H2Global auction [3].
• Replacing imported fossil feedstock (natural gas for hydrogen and ammonia) helps the import bill and energy security [1].
• Over 6 lakh jobs, plus a domestic electrolyser manufacturing base through SIGHT incentives [1].

Environmental

• About 50 MMT of CO₂ would be averted each year at the target scale [1].
• The 2 kg CO₂e/kg threshold and well-to-gate accounting make the "green" claim credible [1].
• Water demand for electrolysis is an issue in water-stressed solar regions, and water must be purified before use [1].

Scientific / Technological

• Electrolyser technology, drying and purifying the hydrogen, and compression are all part of the production chain [1].
• Hydrogen is difficult to transport, which is why production is clustered in hubs and HVICs [1].
• R&D support: SHIP [1], plus a ₹100 crore call for proposals for start-ups launched at the first Green Hydrogen R&D Conference [5].
• Hydrogen train: 10-car trainset (2 Driving Power Cars + 8 Trailer Coaches), about 2,600 passengers, maximum operating speed 75 km/h, design speed 110 km/h [6].

Geopolitical / Strategic

• The 10 MMT export scenario positions India as a supplier to import-dependent markets [1].
• A common benchmark and credible certification help Indian producers compete globally [1].

Administrative / Governance

• Clustering lets projects in hubs access both Central and State scheme benefits [1].
• Transmission-side enablers: the ISTS waiver, Open Access and Banking [1].
• Safety regulation: PESO licensed the Jind hydrogen facility [6].

6. Recent Developments (last 12–18 months)

• 6 August 2025: SECI's first-ever green ammonia auction discovered ₹55.75/kg for 75,000 MTPA to be supplied to Paradeep Phosphates Ltd, Odisha. It was the first of 13 auctions under a tender of 7.24 lakh MT/year [3].
• 2025: across the series, prices ranged from ₹49.75 to ₹64.74/kg [9].
• 2025: the 1st Green Hydrogen R&D Conference was held, and a ₹100 crore call for start-up proposals was launched [5].
• November 2025: a PIB backgrounder reported 8,62,000 tonnes/year of capacity allocated to 19 companies (as of May 2025) [4].
• 2025: manufacturing of the hydrogen trainset was completed, and an electrolysis-based green hydrogen plant was set up at Jind [10].
• 17 July 2026: the hydrogen train was flagged off on the Jind–Sonipat route (89 km). The Jind facility stores about 3,000 kg of hydrogen and is described as India's largest railway hydrogen refuelling facility [6].
• 25 July 2026: the train had covered over 1,200 km, and a Delhi-route trial was announced [7].
• 2–5 November 2026: Bharat RE Summit 2026 [1].

7. Prelims Hooks

• NGHM was approved by the Union Cabinet in January 2023. Nodal ministry: MNRE (not MoPNG) [1][2].
• NGHM outlay: ₹19,744 crore. SIGHT outlay: ₹17,490 crore [1].
• Target: at least 5 MMT/year of green hydrogen by 2030 [1].
• Green Hydrogen Standard: ≤ 2 kg CO₂e per kg H₂, well-to-gate, 12-month average, notified August 2023 [1].
• BEE accredits agencies under the Green Hydrogen Certification Scheme (April 2025) [1].
• In electrolysis, H₂ forms at the cathode and O₂ at the anode [1].
• ISTS charges are waived for 25 years for plants commissioned by 31 December 2030 [1].
• Port-based green hydrogen hubs: Kandla, Tuticorin, Paradip [1].
• The four HVICs: Jodhpur, Odisha, Pune, Kerala [1].
• SIGHT expands to Strategic Interventions for Green Hydrogen Transition [1].
• SHIP expands to Strategic Hydrogen Innovation Partnership (an R&D framework) [1].
• First SECI green ammonia auction: ₹55.75/kg, with supply to Paradeep Phosphates (Odisha) [3].
• India's first hydrogen train: Jind–Sonipat (Haryana, Northern Railway), 89 km, 10 cars, about 2,600 passengers [6].
• The Jind hydrogen facility is licensed by PESO [6].

8. Why Low Ammonia Bids Do Not Yet Mean Cheap Green Hydrogen

• The auction price comes with government support built in
• The record bids of ₹49.75–₹64.74/kg were made under SIGHT, which is an incentive scheme worth ₹17,490 crore [1][9].
• The plants also pay no ISTS charges (fees for using the inter-state power grid) for 25 years [1].

• So the bid shows what a producer will charge after support. It does not show what green ammonia costs without help.

• The ISTS waiver has an end date

• The waiver covers only plants commissioned by 31 December 2030 [1].
• A plant built after that date pays full grid charges. Its cost goes up just when the 5 MMT target is due.

• Other grid users keep paying for the grid. So part of the waived cost is moved onto them, not removed.

• Fossil hydrogen is still much cheaper elsewhere too

• An OECD study of Egypt puts green hydrogen at USD 4.14/kg and grey hydrogen (made from natural gas) at USD 1.8/kg. That is a gap of about USD 2.34/kg [14].

• In India, green ammonia has to beat ammonia made from imported gas. A price fall with subsidy does not close that gap on its own.

• How to use this in Mains: say the cost is falling, but show that the price found at auction is a subsidised price. A falling price is not the same as being able to compete without help.

9. Capacity Awarded Is Not Hydrogen Produced

• The awards cover only about one-sixth of the target
• By May 2025, 8,62,000 tonnes/year of production capacity had been given to 19 companies [4].
• The target is at least 5 MMT (50,00,000 tonnes) a year by 2030 [1].

• So the awards cover about 17% of the target. And an award is a promise to build a plant, not a working plant.

• The money ends in the same year as the target

• NGHM and SIGHT are funded only up to FY 2029–30 [1][4].

• A plant awarded late will get only a few years of support before the scheme ends. Investors may wait to see what comes next.

• Buyers are still mostly the government's own firms

• The first green ammonia auction was tied to one fertiliser buyer, Paradeep Phosphates [3].
• The full tender of 7.24 lakh MT/year of ammonia [3] is still small next to a 5 MMT hydrogen goal.
• Without a rule that asks private fertiliser and refining firms to buy green hydrogen, demand stays with what the government buys at auction.

10. Why Borrowing Costs Matter More Than Machine Costs

• Most of a green hydrogen plant's cost is paid before it starts
• Electrolysers and solar or wind plants are paid for at the start. After that, the 'fuel' (sunlight, wind) is free.

• So the cost of capital (the interest rate investors want for lending money) decides much of the final price.

• Higher risk means much costlier hydrogen

• An OECD–World Bank report finds that raising the cost of capital from 9% to 20% can raise production cost by up to 73% [13].
• Regulatory risk and infrastructure risk (for example, unclear rules or no pipeline) can push it to 24% [13].

• Investors see emerging markets like India as riskier than rich countries. So they ask for higher returns [13].

• What should follow: lower the risk, not only the price

• The same report says de-risking tools (ways to share an investor's risk) bring down the cost of capital [13].
• Brazil's Ceará hub used blended finance (public or concessional money, meaning loans cheaper than market loans, mixed with private money) to lower the cost of capital [13].
• In Egypt, the OECD found that loan guarantees can make green hydrogen more competitive with grey hydrogen in a similar way [14].
• MNRE and SECI could add credit guarantees or long-term purchase contracts to SIGHT. That would cut the interest rate, not just pay a per-kg subsidy.

11. The Water Bill Behind Every Kilogram

• Electrolysis needs clean fresh water
• Making 1 kg of hydrogen needs about 9 to 30 litres of fresh water. The amount depends on how much the water must be cleaned first [12].

• At 5 MMT a year, that works out to about 45 to 150 billion litres a year (worked out from the figures in [12] and [1]).

• The best sun is often where water is short

• The best solar land is in dry states such as Rajasthan, where the Jodhpur HVIC sits [1].

• The note already says water stress is a concern [1]. The real question is whose water it is: the same groundwater is used by farms and towns.

• The port hubs point to an answer

• Kandla, Tuticorin and Paradip are coastal [1]. Plants there can use desalinated seawater instead of groundwater.
• MNRE could make a desalinated or treated-wastewater source a condition for SIGHT support in water-stressed districts.

12. Is Green Hydrogen the Best Use of India's Clean Power?

• The strongest objection
• Hydrogen is an energy carrier, not a source of energy [1]. Making it, storing it and using it again loses energy at each step.

• Critics say solar power used for electrolysis would cut more emissions if it simply replaced coal power on the grid.

• What the objection gets right

• Where a battery or an overhead electric wire can do the job, hydrogen is the more wasteful choice.

• The hydrogen train shows this. It is a 10-car set with a top operating speed of 75 km/h on an 89 km route [6]. It works better as a demonstration project than as a model for the whole network.

• Where the objection fails

• Fertiliser and refining already use hydrogen as a raw material, not as a fuel [1]. Electricity cannot take its place there.
• In steel made by DRI, hydrogen takes the place of coal in a chemical reaction [1]. A battery cannot do that.

• So the honest answer is to rank the uses: fertiliser, refining, steel and shipping first. Mobility only where electric options do not work.

• A gap in the Standard

• The 2 kg CO₂e limit is measured as a 12-month average [1].
• A plant can run partly on grid power from coal at night, then balance it out with clean hours over the year, and still be called 'green'.
• As exports grow, buyers abroad may ask for proof that clean power was used hour by hour. A yearly average may not satisfy them.

13. Anchors for Answers

• Data: 8,62,000 tonnes/year of capacity awarded (May 2025), against a target of at least 5 MMT/year by 2030, so about 17% of the target [4][1]
• Data: Raising the cost of capital from 9% to 20% can raise green hydrogen cost by up to 73% [13]
• Data: 9–30 litres of fresh water are needed per kg of hydrogen [12]
• Report/Committee: OECD–World Bank, Leveraging De-Risking Instruments and International Co-ordination to Catalyse Investment in Clean Hydrogen (2024) [13]; OECD Environment Working Paper No. 205 on green hydrogen in emerging economies (2022) [12]
• Comparison: Egypt: green hydrogen at USD 4.14/kg vs grey at USD 1.8/kg, with guarantees proposed to close the gap [14]. Brazil (Ceará hub): blended finance used to lower the cost of capital [13]
• Scheme: SIGHT (₹17,490 crore): pays a per-kg incentive, but funding ends in FY 2029–30, the same year as the target [1][4]

14. Mains Relevance

• GS-III: Infrastructure (Energy); Conservation and environmental pollution; Science and Technology (indigenisation); Indian economy (industrial policy).
• GS-II: Government policies and interventions (Centre–State scheme convergence in hubs).
• Question stems: 1. Green hydrogen is central to decarbonising India's hard-to-abate sectors. Examine the potential and the constraints of the National Green Hydrogen Mission. (250 words) 2. Discuss how standards and certification frameworks can make India competitive in global green hydrogen trade. (150 words) 3. Cost, not technology, is the main barrier to green hydrogen adoption. Critically analyse in light of recent auction outcomes in India. (250 words)

15. Related Topics to Study Next

• Green ammonia and the fertiliser sector: the largest existing hydrogen user and the first SIGHT auction target.
• Green steel / DRI: decarbonising steel with hydrogen as the reductant.
• India's Updated NDC and Net Zero 2070: the climate commitments NGHM serves.
• Carbon Credit Trading Scheme / BEE: the same agency handles hydrogen certification.
• ISTS, Open Access and RE banking rules: power-sector enablers for electrolysis.
• Fuel cells vs batteries (EV policy): comparing mobility technologies.
• Green shipping and port policy (Green Tug Transition, hubs): the maritime use of ammonia and methanol.
• Grey, blue and green hydrogen classification: a classic Prelims distinction.

16. NCERT Concepts to Revise

• Green hydrogen (Economy): The core subject: hydrogen made by splitting water with renewable electricity, and why it differs from fossil-based hydrogen.
• National Green Hydrogen Mission (Geography): The scheme the note is built around: its outlay, 2030 target, nodal ministry and components like SIGHT.
• Hard-to-abate sectors (Economy): Explains why fertiliser, steel, refining and shipping are the main targets for green hydrogen.
• Grey hydrogen (Economy): The fossil-based rival that green hydrogen must beat on cost; a classic Prelims distinction.
• Green ammonia (Economy): The first SIGHT auction product, used for fertiliser and shipping, with record-low prices.
• Blended finance (Economy): The note proposes it, alongside guarantees, to lower investors' risk and borrowing costs for hydrogen plants.

17. Common Errors / Trap Areas

• Ministry: NGHM belongs to MNRE, not MoPNG or the Ministry of Power. Certification accreditation is done by BEE, not the BIS [1].
• Electrodes: H₂ forms at the cathode and O₂ at the anode. Aspirants often reverse these [1].
• NGHM vs SIGHT: SIGHT (₹17,490 crore) is a component of NGHM (₹19,744 crore), not a separate mission [1].
• Hubs vs HVICs: hubs are at ports (Kandla, Tuticorin, Paradip). HVICs are innovation clusters (Jodhpur, Odisha, Pune, Kerala) [1].
• Standard: the threshold is 2 kg CO₂e per kg H₂, well-to-gate (not well-to-wheel), averaged over 12 months [1].
• Auction price: ₹55.75/kg was the first auction. ₹49.75/kg was the lowest across the series [3][9].
• Hydrogen train power: earlier PIB releases give 1,200 kW, which is per power car. The trainset total is 2,400 kW [6][10].