MEC+ held a virtual session with SolarQuarter on India Hydrogen Fuel Cells. Read the abridged version to know the Hydrogen development plan in India. Following are the government and Industry stakeholders which participated in the summit- Ador Powertron, SKAI Energies, Enapter, National Institute of Solar Energy, EU Energy Policy, NTPC, FCH-JU, Hydrogen Association of India

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Abridged India Hydrogen and Fuel Cells
Show 2020
On 30th Sep, MEC Intelligence (MEC+) hosted a virtual session in partnership
with Solar Quarter and Asia Pacific Hydrogen Association on ‘India Hydrogen
& Fuel Cells Show: Policy, Partnership & Business Strategy”. In this session,
we discussed the opportunities and gaps in India for its hydrogen-based
energy transition. Key stakeholders from across the hydrogen value chain-
hydrogen producers and suppliers, government officials & regulators, fuel cell
companies, and component manufacturers joined us for the session.
India recently announced a Green Hydrogen Task Force, and since then there is an increasing interest
in its demand and technology supply chain. Technological developments and the decline in the cost
of renewable power are the key drivers behind the interest and the growth of the hydrogen sector
globally in the past three years
India annually uses approximately 6 million tonnes (MT) of hydrogen. Refineries, chemical and
fertilizer manufacturing sectors consume 80% of this volume. Fossil fuels are used through steam
methanation reforming (SMR) process to produce hydrogen in India. Fossil based grey hydrogen is
four times expensive than fossil fuel in energy terms. Therefore, using grey hydrogen as a fuel
replacing the conventional fossil fuels does not make sense economically.
However, electrolyzer technology which enables the conversion of electricity to hydrogen molecules
is emerging. The recent decline in the cost of renewable electricity as well as the CAPEX of the
electrolyzer, promises a use case for green hydrogen compared to blue or grey hydrogen produced
from fossils. Renewable prices have reduced by 50% in the past five years and 75% in the past seven
years. Renewable power prices are likely to drop further by 50% to 90% in the next ten years.
Similarly, the electrolyzer CAPEX has reduced by 50% in the past three years and expected to reduce
70–90% in the next five years. As the cost of hydrogen reduces, new applications such as fuel, energy
carrier & storage will emerge.
To put things in perspective, Europe annually consumes 9 million tonnes of hydrogen, similar to
India’s annual consumption at 6 million tonnes. However, Europe projects an 86% increase in its
hydrogen demand by 2030, driven by its use in new sectors like heating, transport, and power. To
meet this new demand, Europe plans to increase the amount of green hydrogen in its energy mix.
Green hydrogen will meet almost all of this new demand, 4.4 million tonnes domestically produced,
and another 3 million tonnes imported from Africa, Ukraine, and other nearby geographies. To
support this, the European Commission plans to deploy 40 GW of renewable hydrogen electrolyzers
by 2030 in Europe and another 40 GW in Africa and Ukraine.
These ambitious targets by Europe open two avenues of opportunities for India- a) setting a similar
hydrogen target for itself and b) targeting the opportunities in Europe through technology and
supply chain collaborations.

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Dr R K Malhotra, President, Hydrogen Association of India
COVID has increased the need for cleaner energy solutions. Hydrogen is one of the greener solutions
which enables energy independence and security for India. The government is also focusing on
hydrogen deployment in India along with the private energy leaders such as Indian Oil Company Ltd,
Adani, Reliance etc. Following are the opportunities and challenges across the hydrogen value chain:
• Hydrogen Production- Currently, refineries produce and supply hydrogen. As the hydrogen
demand increases, existing refineries have the opportunity to scale supply and distribution
of hydrogen to emerging applications like fuel cell vehicles. But challenges related to the
cost of hydrogen production from existing fossil fuel sources and new technologies like
electrolysis exist.
• Hydrogen Transmission and Distribution-Hydrogen can be transmitted and distributed via
pipelines, ships, cylinders/containers/tankers. Transportation can be through natural gas
pipelines or dedicated new pipelines. However, due to low energy density by volume and
high-pressure requirements, transport through gas pipelines is not easy. Therefore,
decentralized reformers or electrolyzers are more suitable to meet niche demand segments.
• Hydrogen Storage-Hydrogen is either stored as a compressed gas or in a liquidized form in
pressurized tanks for small-scale mobile and stationary applications. 85% of the hydrogen
today is produced and consumed on-site while 15% transported via trucks or pipelines.
Other hydrogen storage mediums are also available such as materials-based storage,
geological storage etc. Demand for storage capacity will increase as the demand for
hydrogen increases.
Mr Bart Biebuyck, Executive Director, The Fuel Cells and Hydrogen Joint Undertaking (FCH-JU)
Mr Bart Biebuyck highlighted that hydrogen is likely to meet about 25% of Europe’s energy demand
by 2050. To reach the intended energy mix, Europe has laid down a three-phased plan. The Fuel Cells
and Hydrogen Joint Undertaking (FCH-JU) is on bringing investments, fostering demand, developing
an active market enabled by incentives and credits, and leading & supporting the R&D. FCH-JU and
European Commission place hydrogen high on their strategy for bilateral and regional cooperation
and in international markets.
Mr Ravin Mirchandani, Executive Chairman, Ador Powertron Ltd and Mr Craig Ehrke, CEO, SKAI
Energies Australia
The conversion of electrons to hydrogen molecules offers long term flexibility to the energy system
since hydrogen can be stored compared to charging a battery cell. Hydrogen molecule does not
degrade over time and can be easily transported or converted back to electricity with a fuel cell.
Hydrogen-based standalone power system (SAP) is a way to use renewable energy 24*7, especially
in isolated locations like in Ladakh or North-east Indian states. Hydrogen based SAPs can support off-
peak energy use and reliable local power. Hydrogen can also simplify energy-related issues in India
such as electrification of villages, storage of renewable energy sustainably and support a challenged
electricity grid.

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Dr Joydev Manna, Senior Scientist, National Institute of Solar Energy
Hydrogen R&D goes back to 2005 when MNRE developed the National Hydrogen Roadmap (NHER)
to accelerate the development and commercialization of hydrogen technologies in India. India has
developed and demonstrated many Hydrogen-CNG and HICE (Hydrogen Internal Combustion
Engine) vehicles midway before the transition to hydrogen-powered vehicles. Some industry
updates
• Mahindra & Mahindra has developed a HICE Minibus and H2-Diesel Dual Fuel Vehicle.
• Tata Motors has developed a fuel cell-powered bus.
• IIT-BHU has developed and demonstrated 2W and 3W hydrogen-powered fuel vehicles in
Varanasi.
Ms Eva Hennig, Head of Department, EU Energy Policy
Ms Eva Hennig presented the updates on the German project to use hydrogen in the gas distribution
grid. The project aims at making the grids hydrogen ready.
In this project, 30 MW electrolyzer plant at a refinery produces hydrogen. Hydrogen is fed in the
local gas distribution grid. The key customers using this hydrogen-blended-gas are residential
customers and the nearby airport, as green jet fuel. The by-product of the electrolyzer is oxygen
which is used to produce green cement.
Currently, 50 MW of electrolyzers are in operation in Germany. There are plans to install 5–10 GW
electrolyzer capacity in the next 5–10 years.
Panel Discussion
# Trend 1 — Hydrogen is currently very expensive but there is potential for cost reduction
• In India, grey hydrogen costs today 150–200 INR/kg (2 USD/kg + significant transportation
cost). Therefore, it is economical to use in an on-site location.
• Green hydrogen costs around 350 INR/kg with the cheapest renewable power available
today in India.
• To reduce the cost of green hydrogen cost of electricity and electrolyzer need to be reduced
since these are the two critical components of green hydrogen.
• Electrolyzer costs are coming down as the market is gaining volume demand. It can further
go down using high-volume automated production of the electrolyzer. Enapter, a leading
hydrogen electrolyzer manufacturer in Europe, supports the cost reduction trend. The cost
of their 2.4 KW electrolyzer unit has reduced from 15000 EUR to 9000 EUR in three years.
Their target is to bring it down to 1000–2000 EUR in the next few years.
• Green hydrogen will not be able to compete with fossil fuels or grey hydrogen even over the
next five years since the renewable power will be high priced at INR 4/kWh (with ISTC). The
cost of renewable electricity needs to come down to 1.5 INR/kWh, to make green renewable
competitive to grey hydrogen from SMR from natural gas.
• Similarly, Europe has a target to bring down the cost of green hydrogen to 2 EUR/kg in the
next ten years, from a current price of 4–5 EUR/kg.

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# Trend 2 — Political and regulatory clarity is critical for the hydrogen energy transition
• The Indian government has a policy in place for R&D and demonstration of hydrogen
technology, but clear and long-term policies are required for deployment and end-use
applications of hydrogen. Some of the points to be considered:
o Clarify the role of blue hydrogen in the hydrogen economy. While it is cost-effective to
produce and use blue hydrogen, it is still not as environment friendly as green hydrogen.
Europe plans to use blue hydrogen only as a transitional fuel in phase 1 of its hydrogen
plan. Its end objective is to use green hydrogen only.
o However, policies and incentives should be planned for a limited time and revised
periodically to prevent the lock-in effect of subsidized blue hydrogen. The growth of blue
hydrogen will affect the interest in green hydrogen.
o Given the current high cost of hydrogen, financial incentives will instigate the demand
from new applications.
o Regulatory and financial support to establish indigenous production of hydrogen fuel
cell stacks, electrolyzers to reduce the cost of FCV
o Establish globally at-par codes and standards for production and supply of hydrogen and
HFVs
o Purchase obligation mechanism to mandate the use of blue or green hydrogen RPO type.
Promotion of green hydrogen in steel and other metallurgical industries
• US-India Strategic Partnership has launched Hydrogen Task Force which is going to bring out
the document for Hydrogen Vision for India this year. It will address all the policy issues such
as the focus of hydrogen development in India.
# Trend 3 — Hydrogen will make sense in niche applications only
Hydrogen can compete with batteries only when the cost of the fuel cell comes down. At the same
time, the cost of batteries is also reducing. Therefore, at different point of time in the future, either
of the two options could economically make sense. However, their applications will be limited by
their physical and technical limitation. E.g. batteries are more relevant for short-range or inter-city
vehicles but not for the long route heavy-duty transport since the volume and weight of batteries
will reduce the carrying capacities. Therefore, hydrogen might prove suitable for all long-range
transportations- heavy-duty trucks, aviation, ships.
# Trend 4 — Enormous growth in renewable is imperative for green hydrogen transition
• Europe’s goal is to become carbon neutral by 2050 and green hydrogen has a significant role
to play in the plan. Despite the high renewable share in the electricity mix of north-western
European countries, the current share is not enough for producing hydrogen at scale.
Therefore, to support the green hydrogen transition, Europe plans to increase its renewable
share in its electricity mix.
• Till the time new renewable capacity comes online, Europe plans to use blue hydrogen or
flow carbon-hydrogen as a transitional fuel until 2030.
Similarly, demand for large capacity of additional renewable power plants will emerge if India pushes
towards green hydrogen.

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