The India Hydrogen Alliance (IH2A) has urged the government to allocate an additional $2.5 billion to the National Green Hydrogen Mission (NGHM) in the upcoming budget.
The funding, according to IH2A, is critical for driving demand-side incentives, capital expenditures for hydrogen infrastructure, and the development of hydrogen hubs across the country.
Budget Recommendation for NGHM Expansion
In its budget proposal, IH2A recommended increasing the financial support for NGHM by $2.5 billion, supplementing the $2.3 billion already committed.
The organization emphasized that additional funds are necessary to address slow project development and the absence of long-term offtake agreements for green hydrogen.
Tackling Industry Challenges
IH2A outlined key measures to overcome hurdles in the green hydrogen sector. These include:
- Demand-side incentives: Encouraging potential offtake entities in industries like refineries, fertilizers, steel, and chemicals to adopt green hydrogen.
- Capital expenditure subsidies: Supporting the establishment of hydrogen production facilities and infrastructure.
- Green Hydrogen Development Corporations (GHDCs): Creating dedicated entities to oversee project development and accelerate progress.
Development of Hydrogen Hubs
IH2A also highlighted the need for public funding to facilitate the establishment of five additional national hydrogen hubs.
These hubs would play a pivotal role in creating a robust green hydrogen ecosystem and achieving India’s 2030 targets.
High Costs Hindering Offtake Agreements
Amrit Singh Deo, IH2A Secretariat Lead, expressed concern over the reluctance of potential green hydrogen offtake entities. They are hesitant to commit to long-term agreements due to the high costs.
Deo said, “We propose increasing the budgetary allocation for NGHM by an additional $2.5 billion to offer offtake-linked demand-side incentives”.
Boosting Green Hydrogen Adoption
IH2A believes the increased funding will stimulate the development of more green hydrogen projects.
These initiatives are expected to reduce production costs, enhance local supply chains, and ensure India meets its green hydrogen ambitions.
About IH2A
The India Hydrogen Alliance is a coalition of global and Indian companies. It works collaboratively with private sector partners, the government, and the public.
As reported by msn.com, its mission is to make green hydrogen more affordable and widely available. It also aims to foster a sustainable hydrogen economy in India.
