Council on Energy, Environment and Water Integrated | International | Independent
Suggested Citation: Rajakumaran, Hashvitha, Hemant Prakash Singh, Karan Kothadiya, Deepak Yadav. 2024. Mainstreaming Decentralised Green Hydrogen Applications in India: Compendium of Industrial, Commercial and Remote-Area Applications. New Delhi: Council of Energy, Environment and Water (CEEW).
This report explores the role of decentralised green hydrogen systems in India's energy transition. Green hydrogen, produced through water electrolysis using renewable energy, is a clean energy carrier that presents versatile use cases as a feedstock, fuel, and energy carrier in decarbonising hard-to-abate sectors. Decentralised green hydrogen systems involve producing and using green hydrogen near the point of consumption, eliminating the need for transportation or transmission of renewable energy required for its production.
The report explains the differences between centralised and decentralised hydrogen systems and presents the unique advantages of decentralised green hydrogen systems in potential applications. In the industrial sector, we look at decentralised green hydrogen used for metallurgical processing, glassmaking, hydrogen peroxide production, thermal power production, food processing, chemicals and pharmaceuticals, and semiconductor manufacturing. Furthermore, the report profiles commercial and remote-area applications such as using green hydrogen as a cooking fuel, fuel for heavy machinery, backup power source in telecom towers, energy source powering microgrids, and military applications.
The report presents an estimated potential green hydrogen demand in these applications with a transition to green hydrogen from conventional fuels and commodities, the associated emission reduction potential, and the potential reduction in import expenditure. It also presents a breakeven green hydrogen cost at which green hydrogen becomes viable against conventional fuel and commodities in each application.
Green hydrogen, produced through water electrolysis using renewable energy (RE), is a clean energy carrier that has versatile uses, including as a feedstock, fuel, and energy carrier, in decarbonising hard-to-abate sectors. In decentralised green hydrogen systems, the production and use of green hydrogen are near the point of consumption, eliminating the need to transport it or transmit the RE required to produce it.
We find that unconventional decentralised green hydrogen applications in industries such as metallurgical processing, glass making, thermal power production, food processing, chemicals and pharmaceuticals, and semiconductor manufacturing could be already economically viable or close to viability. Furthermore, we find that applications in commercial and remote-area settings, such as its use as a cooking fuel, fuel for heavy machinery, a backup power source in telecom towers, and an energy source powering microgrids and military applications, could contribute to a substantial potential demand for green hydrogen in India, comparable to that for larger, more conventional green hydrogen applications, such as in the fertiliser, refining, and steel industries and long-haul heavy-duty road transportation. We present the use cases for green hydrogen in these applications in Figure ES1.
Figure ES1: Use cases of decentralised green hydrogen systems
Source: Authors’ analysis
In this report, we explore the unique advantages that decentralised green hydrogen systems offer and also discuss the challenges and constraints that they impose on producers and consumers. We quantify the potential demand for green hydrogen in India that would arise through these decentralised applications, the associated emissions mitigation potential, the breakeven cost of green hydrogen to compete against conventional fuels and commodities that it will replace, and the potential reduction in import expenditure with a transition to green hydrogen.
Beyond their ability to decarbonise applications, decentralised green hydrogen systems also offer several unique advantages:
In addition, we present certain application-specific advantages that decentralised green hydrogen systems offer Table ES1.
Table ES1: Unique application-specific advantages offered by decentralised green hydrogen systems
We observe that the potential demand for green hydrogen is much higher in commercial and remote-area applications than in industrial applications. However, the lower break-even cost of most of these applications signifies a lack of economic viability.
We group the applications into four categories, as denoted in Figure ES2, assuming a demand potential higher than 100 kilo metric tonnes per annum (KTPA) to be large and a break-even cost higher than USD 5 per kg to be economical. The estimation results are as follows:
Figure ES2: Most commercial applications have a high potential demand for green hydrogen but are currently uneconomical
Source: Authors’ analysis
By our estimates, a complete transition to green hydrogen in the applications considered in this report could reduce GHG emissions by up to 221 MTPA. Green hydrogen use in cooking would account for around 209 MTPA of the total emissions mitigation potential due to high demand in this sector. We find that industrial applications have a higher specific emissions mitigation potential associated with a green hydrogen transition than commercial and remote-area applications, albeit with a lower overall emissions mitigation potential due to correspondingly lower potential demand for green hydrogen. Metallurgical processing and cooling in thermal power plants are the outliers, with extremely high specific emissions mitigation potentials of around 65 kg-carbon dioxide equivalents (CO2eq.) per kg-H2 and 46.4 kg-CO2eq. per kg-H2 , respectively. All other applications fall in the range of 10 kg-CO2eq. per kg-H2 to 20 kg-CO2eq. per kg-H2 . It may be interesting to note that the difference in energy efficiencies of PNG, LPG, and biomass used as cooking fuels translates to a difference in the specific emissions mitigation of around 13 kg-CO2eq. per kg-H2 between the three fuels.
We find that decentralised green hydrogen systems are well positioned to serve multiple use-cases, offering unique application-specific advantages, in addition to decarbonising the applications. The economic, technological, and operational barriers to safe and scalable deployment of decentralised green hydrogen are common to most use cases. We outline the following policy recommendations to overcome these barriers:
Augmenting the National Green Hydrogen Mission
How can Hydrogen Electrolysers be Made in India?
Green Hydrogen Testing Infrastructure and Facilities in India
Unlocking India's RE and Green Hydrogen Potential
