From Vision to Viability: Accelerating India’s Green Hydrogen Economy
Green Hydrogen: India’s Clean-Industrial Pivot
India’s pledge to reach net-zero emissions by 2070 hinges significantly on green hydrogen—especially for decarbonizing sectors where electrification alone falls short. The National Green Hydrogen Mission (2023) sets a bold sights on 5 million metric tons (MMT) of production capacity by 2030. Impressively, announced projects already surpass this target by more than 2.5 time.
Yet the progress is uneven: as of 2024, actual commissioned capacity remains under 0.01 MMT, reflecting early-stage pilots more than full-scale implementation.
The Demand Puzzle: Supply Is Strong—Demand Still Nascent
While India’s green hydrogen supply pipeline is robust, demand-side traction remains sluggish. Barriers include:
Higher production costs: Green hydrogen currently costs $4–$5/kg, compared to $2.3–$2.5/kg for grey hydrogen—a cost gap that limits commercial appeal.
Underdeveloped infrastructure, including lack of pipelines and storage.
Financing challenges, such as elevated interest rates and capital intensity.
These factors delay adoption, even where potential is promising.
Five Practical Strategies to Unlock Green Hydrogen Demand
Bain outlines five high-impact, demand-focused levers to catalyze adoption in 2025 and beyond:
Blend-in Approach
Introduce small quantities of green hydrogen into grey hydrogen or piped natural gas networks in sectors like refineries, fertilizers, and utility supply—balancing technical feasibility with price sensitivity.Targeted Substitution in Niche Industries
Focus on industries like glass, ceramics, and specialty chemicals where green hydrogen is cost-neutral versus grey options.Public Procurement Leadership
Drive market creation through government-led demand—especially in sectors like green steel where public sourcing can spur scale.Export Markets Development
Explore exporting green hydrogen or green-ammonia to countries already advancing in hydrogen adoption.Product-Based Demand Strategy
Encourage exports of hydrogen-enabled products—such as green steel or ammonia—to markets with favorable tailwinds.
Catalyzing the Ecosystem: Enablers for Market Scaling
To convert promise into purchase, India needs to strengthen its hydrogen ecosystem:
Infrastructure development, including storage, pipelines, and fueling stations.
Risk-mitigating offtake agreements, such as long-term contracts with buyers.
Financial incentives, like viability gap funding and sovereign guarantees to attract capital.
Alignment with global standards, ensuring technology, safety, and trade readiness.
With these enablers in place, green hydrogen can shift from pilot projects to economic reality.
Why It Matters: Imperatives for Business & Policy Leaders
Strategic Differentiator: Companies pioneering hydrogen use today will shape industry norms tomorrow.
Policy Impact: Targeted subsidies and infrastructure investments can shift cost curves rapidly.
Global Alignment: Building standards and exports into early hydrogen strategies creates competitive advantage.
Conclusion: From Pilot to Purchase — India’s Next Frontier
India’s green hydrogen ambition is clear. Translating that ambition into scalable demand requires both strategic creativity and catalytic support. By blending hydrogen into existing systems, unlocking industrial niche use cases, and enabling exports, India can shift from promise to purpose—and lead the global energy transition.