Green Hydrogen Production Cost in India: Fuel of the Future

Green Hydrogen Production Cost in India: Green hydrogen’s potential to decarbonise hard-to-abate sectors such as steel, cement, fertilisers and heavy-duty transportation has positioned it as a cornerstone of the global energy transition.

India, with its abundant renewable energy resources and ambitious carbon neutrality target by 2070, has placed green hydrogen at the forefront of its energy strategy being implemented through the National Green Hydrogen Mission. The country’s renewable energy landscape plays a crucial role in this initiative. As of 2024, India has 128 GW of installed solar and wind capacity, with a target of reaching 500 GW by 2030.

The cost of renewable power in India is among the lowest in the world, and coupled with extensive renewable energy infrastructure, this positions India as a promising global hub for affordable green hydrogen production. However, the economic viability of green hydrogen remains a pressing challenge. At production costs of Rs 350-Rs 450 per kg, green hydrogen struggles to compete with grey hydrogen (Rs 160-Rs 200 per kg) derived from natural gas, which is used throughout the industry.