India’s Green Hydrogen Demand to Reach 2.85 MMT/Year by 2030, Says USAID
Introduction
India is rapidly advancing its clean energy transition, with green hydrogen emerging as a key pillar of its decarbonization strategy. According to a recent study by the United States Agency for International Development (USAID), India’s green hydrogen demand is projected to reach 2.85 million metric tons (MMT) per year by 2030.
This surge in demand is driven by ambitious government policies, industrial adoption, and global commitments to achieving net-zero emissions. As the world moves toward sustainable energy solutions, India’s green hydrogen roadmap is gaining momentum, positioning the country as a potential global leader in hydrogen production and utilization.
Why Green Hydrogen is Vital for India’s Energy Transition
Green hydrogen, produced using renewable energy sources like solar and wind, is a clean alternative to fossil fuels. It plays a crucial role in decarbonizing hard-to-abate sectors such as:
- Steel and cement production – Reducing emissions in energy-intensive industries.
- Refineries and chemicals – Lowering carbon footprints in ammonia and methanol production.
- Transportation – Enabling hydrogen-powered fuel cell electric vehicles (FCEVs) for long-haul transport.
- Energy storage – Balancing renewable energy fluctuations in the grid.
Key Findings from USAID’s Report
1. Projected Demand Growth
- India’s green hydrogen demand is expected to reach 2.85 MMT per year by 2030.
- The industrial sector (fertilizers, chemicals, refineries) will be the largest consumer.
- By 2050, demand could exceed 20 MMT/year, aligning with India’s net-zero goals (IEA Report).
2. Government Policies Driving Growth
The Indian government has launched multiple initiatives to support green hydrogen adoption, including:
- National Green Hydrogen Mission – MNRE – A ₹19,744 crore ($2.4 billion) scheme to accelerate production and adoption of green hydrogen.
- Hydrogen Purchase Obligations (HPOs) – Mandating industries to use a certain percentage of green hydrogen.
- PLI Scheme for Electrolyzers – Encouraging domestic manufacturing of electrolyzers to reduce dependency on imports.
3. Declining Cost of Green Hydrogen Production
- The current cost of green hydrogen production is around $4-6 per kg, but advancements in electrolyzer efficiency and renewable energy are expected to bring it down to $1-2 per kg by 2030.
- India’s abundant solar and wind resources provide a cost advantage, making green hydrogen more competitive (IRENA Report).
Challenges in Scaling Green Hydrogen
Despite the positive outlook, several challenges need to be addressed:
- High initial investment – Infrastructure for electrolyzers, pipelines, and refueling stations requires significant capital.
- Lack of hydrogen storage and transport infrastructure – Efficient storage and distribution networks are still in early stages.
- Policy gaps – Clearer incentives and long-term policies are needed to attract private sector investment.
How India Can Become a Global Green Hydrogen Hub
To capitalize on this growing demand, India must:
- Expand renewable energy capacity – Increase solar and wind power generation to support green hydrogen production.
- Strengthen public-private partnerships – Encourage collaborations between the government and industries.
- Develop hydrogen corridors – Create dedicated hydrogen production and distribution zones.
- Attract foreign investment – Offer tax incentives and reduce import duties on electrolyzers and fuel cells.
Global Context: What Other Countries Are Doing
Several countries have made significant investments in green hydrogen:
- European Union – Plans to produce 10 MMT of green hydrogen by 2030 under its EU Hydrogen Strategy.
- United States – The Inflation Reduction Act (IRA) 2022 offers $3/kg tax credits for green hydrogen production.
- China – Aims to produce 100,000–200,000 tons of green hydrogen annually by 2025 through state-backed initiatives.
Conclusion
India’s green hydrogen market is on the brink of rapid expansion, with demand expected to reach 2.85 MMT/year by 2030. Strategic policy interventions, declining production costs, and strong industrial adoption will be key drivers of this growth.
As global momentum builds, India has the potential to become a green hydrogen powerhouse, reducing its reliance on fossil fuels and positioning itself at the forefront of the global hydrogen economy.
