National Green Hydrogen Mission 2023: A Sustainable Energy Transition Mission

Policy Update
Gayathri Pramod

Introduction

The National Green Hydrogen Mission is a transformative initiative launched by the Government of India to revolutionize the country’s energy landscape by markedly reducing carbon emissions and enhancing energy security. India’s Green Hydrogen Mission is set to revolutionize the country’s energy landscape by markedly reducing carbon emissions and enhancing energy security.

As the world’s third-largest energy consumer, India aims to lessen its heavy reliance on fossil fuel imports, which reached $190 billion in 2024. The mission targets the production of 5 million tonnes of green hydrogen by 2030, leveraging India’s abundant solar and wind energy resources. Nevertheless, the initiative encounters several obstacles, such as high production costs, the necessity for infrastructure development, and intensifying global competition. With strong policy support, corporate investments, and potential export opportunities, India strategically positions itself as a leader in the green hydrogen industry, promoting sustainability and economic growth.

As the world moves towards cleaner energy alternatives to combat climate change, green hydrogen has emerged as a promising fuel with the potential to decarbonize various sectors, including industry, transport, and power. This mission aims to leverage India’s renewable energy resources to produce green hydrogen, reduce dependency on fossil fuels, and promote a sustainable energy ecosystem. With ambitious targets and strategic frameworks, the initiative is expected to drive innovation, investment, and economic growth while aligning with India’s commitment to achieving net-zero emissions by 2070.

Objectives and Significance of the National Green Hydrogen Mission

The primary objective of the National Green Hydrogen Mission is to establish India as a key global hub for green hydrogen production, export, and technology development. The mission envisions an annual production capacity of at least 5 million metric tonnes (MMT) of green hydrogen by 2030, potentially scaling up further based on demand and infrastructure expansion. This mission aligns with India’s broader goal of energy transition, promoting a cleaner and more self-sufficient energy sector while fostering economic development.

One of the most significant aspects of the mission is its potential to reduce India’s dependence on fossil fuels and imported energy. India is one of the largest importers of crude oil and natural gas, making it vulnerable to global price fluctuations and supply disruptions. By investing in green hydrogen technology, the country can diversify its energy sources, enhance energy security, and mitigate the risks associated with volatile fossil fuel markets.

Furthermore, green hydrogen is critical in decarbonizing hard-to-abate industrial sectors such as steel, cement, and chemicals, which traditionally rely on fossil fuels for high-temperature processes. Industries can significantly reduce their carbon footprint by replacing conventional hydrogen derived from natural gas (gray hydrogen) with green hydrogen. Additionally, green hydrogen is expected to drive the adoption of fuel cell technologies in transportation, particularly in long-haul trucking, shipping, and aviation, which are currently challenging to electrify using conventional batteries.

The mission is also poised to generate significant economic benefits, including job creation, infrastructure development, and increased foreign investments. The growth of the green hydrogen sector will necessitate large-scale investments in electrolyzers, renewable energy projects, and hydrogen storage and transportation facilities. This, in turn, will create employment opportunities across various segments, from manufacturing to research and development, ultimately contributing to India’s economic resilience and industrial competitiveness.

India’s energy sector is undergoing rapid growth, driven by an ever-increasing demand for power. As the world’s third-largest energy consumer, the nation is expected to see its energy needs rise by 35% by 2030. This escalating demand has resulted in a heavy reliance on imported fossil fuels, leading to an energy import bill that soared to $190 billion in 2024. In parallel, India has set an ambitious goal of achieving net-zero carbon emissions by 2070, which amplifies the need for sustainable energy solutions.

Green hydrogen emerges as a powerful alternative, offering the potential to decarbonize high-emission industries while enabling the country to fulfill its dual goals of energy independence and environmental stewardship. The production of green hydrogen involves harnessing renewable electricity to split water into hydrogen and oxygen. This method generates no carbon emissions, unlike grey hydrogen, which is produced from carbon-emitting fossil fuels. With India’s abundant solar and wind resources, the nation is uniquely positioned to become a global green hydrogen market leader, a testament to its potential in the energy sector. However, overcoming significant economic and logistical challenges to unlock this potential will be essential.

Challenges 

Despite its immense potential, the National Green Hydrogen Mission faces several challenges that must be addressed to ensure its success. One of the primary hurdles is the high cost of production. Green hydrogen is currently more expensive than gray and blue hydrogen due to the high costs of electrolyzers and the substantial energy requirements for electrolysis. Scaling up production and achieving cost competitiveness will require significant technological advancements, economies of scale, and policy interventions to incentivize investments. Policymakers play a crucial role in formulating and implementing these interventions,  contributing to the mission’s success.

Another major challenge is the availability of adequate renewable energy sources. Since green hydrogen production relies on electricity generated from renewable sources such as solar and wind, ensuring a consistent and reliable power supply is crucial. However, renewable energy generation is inherently intermittent, which can impact hydrogen production efficiency. Developing advanced energy storage solutions and grid infrastructure will be necessary to overcome this limitation.

Infrastructure constraints also pose a significant barrier to large-scale hydrogen adoption. The lack of a well-developed hydrogen storage, transportation, and distribution network limits the commercial viability of green hydrogen projects. Hydrogen, a highly flammable and low-density gas, requires specialized infrastructure such as pipelines, liquefaction facilities, and refueling stations, all of which demand substantial investment and regulatory support.

Additionally, technological and research challenges must be addressed to enhance the efficiency and affordability of green hydrogen production. Research and development (R&D) investments are essential to driving innovation in electrolyzer technologies, improving hydrogen storage methods, and developing advanced fuel cell applications such as fuel cell vehicles, portable power systems, and backup power for remote or off-grid locations. Collaboration between government agencies, private sector players, and academic institutions will be critical to accelerating technological breakthroughs.

Another concern is the global competition in the hydrogen sector. Several countries, including the European Union, the United States, Japan, and Australia, are aggressively investing in green hydrogen projects, positioning themselves as early movers in the market. India must adopt a strategic approach to remain competitive by fostering international collaborations, securing financial incentives, and establishing a robust policy framework to attract investments and technological expertise.

One of India’s most significant obstacles to the widespread adoption of green hydrogen is its excessively high production cost. Currently, producing green hydrogen ranges from $4 to $5 per kilogram, nearly twice the price of grey hydrogen. For green hydrogen to become more competitive in the market, its production cost must be lowered to approximately $2 per kilogram. Several factors contribute to these elevated costs, including the requirement for a reliable supply of renewable energy for production and the high expenses associated with electrolyzer technology.

A report titled “Green Hydrogen: Enabling Measures Roadmap for Adoption in India” highlights that the key to economically viable green hydrogen lies in swiftly expanding India’s renewable energy capacity while reducing transmission and distribution (T&D) costs. Additionally, it is essential to decrease the cost of electrolyzers, which currently account for 30–50% of the total production costs. Achieving these reductions will require a concerted effort from policymakers, private investors, and technology innovators.

Future Prospects

To address these challenges and accelerate the transition to a hydrogen-based economy, the Indian government has outlined a comprehensive policy framework under the National Green Hydrogen Mission. This includes financial incentives, production-linked subsidies, and regulatory reforms to promote green hydrogen production and adoption. Additionally, the government is encouraging public-private partnerships (PPPs) to facilitate hydrogen infrastructure development and attract foreign direct investment (FDI).

One of the key initiatives under the mission is the establishment of green hydrogen hubs across various regions with access to abundant renewable energy resources. These hubs will serve as integrated ecosystems for hydrogen production, storage, and distribution, enabling cost-effective supply chains and economies of scale. Furthermore, the government is exploring the possibility of carbon pricing and green hydrogen mandates for industries to drive demand and ensure a market for hydrogen-based solutions.

India also actively engages in international partnerships and collaborations to leverage global expertise and secure access to cutting-edge hydrogen technologies. Bilateral agreements with countries like Germany, Japan, and the UAE are expected to facilitate knowledge exchange, joint R&D initiatives, and cross-border hydrogen trade.

In early 2022, the Indian government launched the National Green Hydrogen Mission with an impressive investment of $2.3 billion. This ambitious program is designed to produce 5 million tonnes of green hydrogen annually by 2030, supported by incentives to enhance production, infrastructure development, and market expansion. Much of India’s hydrogen use relies on grey hydrogen, particularly in refineries and fertilizer manufacturing. The mission aspires to shift these sectors toward greener options and extend the utilization of green hydrogen into industries such as steel production and transportation. 

Major Indian firms like Indian Oil Corporation, Adani Group, and Reliance Industries are heavily investing in green hydrogen projects, reflecting an increasing excitement for this burgeoning sector. By creating dedicated green hydrogen facilities, these corporations are promoting widespread adoption and helping establish a dependable demand that will aid in lowering costs.

Conclusion

The National Green Hydrogen Mission marks a significant step toward India’s clean energy future, potentially transforming its energy landscape and establishing it as a global leader in green hydrogen. While challenges such as high production costs, infrastructure limitations, and technological barriers remain, a well-structured policy framework, strategic investments, and international collaborations can drive the successful implementation of this mission.

As India continues to expand its renewable energy capabilities and strengthen its commitment to decarbonization, green hydrogen will play a pivotal role in achieving energy security, economic growth, and environmental sustainability. If effectively executed, the mission will position India as a frontrunner in the global hydrogen economy and contribute significantly to the fight against climate change by reducing greenhouse gas emissions and fostering a cleaner, greener world.

Therefore, India’s pursuit of green hydrogen transcends the simple transition of energy sources; it represents a comprehensive vision for a cleaner, more resilient, and economically prosperous future. By directing investments into green hydrogen initiatives, India can significantly reduce its carbon footprint, enhance energy security, and create new economic opportunities.

Although the journey ahead may present various challenges, the potential rewards are substantial—serving as a guiding light for a sustainable future powered by clean energy. The journey toward a greener future begins with bold actions, and India is at the forefront of this movement. As the nation works to develop a strong green hydrogen ecosystem, it has the potential to inspire the global community to set higher goals and expedite efforts toward sustainability.

References

About the Author: The article is written by Ms. Gayathri Pramod, a Research Intern at IMPRI. She is a final year PhD student specializing in West Asia.

Acknowledgement: I extend my sincere gratitude to each and everyone who guides me through this process, especially Dr. Arjun Kumar and Aasthaba Jadeja.

Disclaimer: All views expressed in the article belong solely to the author and not necessarily to the organisation.

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