India has initiated talks with European Union (EU) exploring opportunities of exporting 10 million mt of green hydrogen to buyers in Europe and latter in turn invest in clean energy projects in India, government sources said on Monday, July 10.
Though no timelines have yet to be framed to implement such a program, the sources said that Europe based entities will be eligible to set up clean energy projects in India and claim carbon credits in return.
They said that that aim is to export at least 70 percent of India’s green hydrogen production as domestic use will be limited, at least in initial years and overseas sales will be important to stabilize the price of green hydrogen and hedge it against domestic oversupply and resultant low price.
It was pointed out that domestically produced green hydrogen will not be cost competitive at least not before end of the current decade compared to fossil fuel and hence it is imperative that part of the production is set aside for exports.
As per estimates worked out by the government, in the initial years, until 2030, extensive adoption of green hydrogen risked pushing up price of end products. It has been worked out that until 2030, green hydrogen cost will range $1.5-2/ kg and thereafter start to fall to levels of $1/kg only around 2050.
Hence the government is working towards exporting significant volumes overseas and incentivize buyers in EU to construct in clean energy projects in India.