Context: The Union Ministry of New and Renewable Energy (MNRE) has recently published guidelines and incentives to promote the procurement of green hydrogen as part of the National Green Hydrogen Mission.

About Strategic Interventions for Green Hydrogen Transition (SIGHT) Programme

• It is a subcomponent of National Green Hydrogen Mission.

• Aim: To bolster domestic electrolyser manufacturing and green hydrogen production.

In the initial stage, two distinct financial incentive mechanisms were proposed with an outlay of Rs 17,490 crore up to 2029-30:

• Incentive for manufacturing of electrolysers

• Incentive for production of green hydrogen.

• Depending on the markets and technology development, specific incentive schemes and programmes will continue to evolve as the Mission progresses.

• Implementing agency: The Solar Energy Corporation of India (SECI) would be the implementing agency responsible for the scheme’s execution.

Aim

• To bolster domestic electrolyser manufacturing and green hydrogen production.

• These incentives are designed to facilitate cost reduction and rapid expansion.

What is the National Green Hydrogen Mission?

• It is implemented by the Ministry of New and Renewable Energy with an outlay of Rs 19,744 crore from FY 2023–24 to FY 2029–30.

• The overarching objective of the Mission is to make India a global hub for the production, usage, and export of Green Hydrogen and its derivatives.

The expected outcomes of the mission by 2030, are as follows

• India’s Green Hydrogen production capacity is likely to reach 5 MMT per annum, contributing to reduction in dependence on the import of fossil fuels. Achievement of Mission targets is expected to reduce a cumulative Rs 1 lakh crore worth of fossil fuel imports by 2030.

• This is likely to leverage over Rs 8 lakh crore in total investments and create over 6 lakh jobs.

• Nearly 50 MMT per annum of CO2 emissions are expected to be averted through the production and use of the targeted quantum of Green Hydrogen.

• It has a provision for supporting pilot projects for low-carbon steel, mobility, shipping, and ports.

• The Mission provides allocations for various sub-components of the Mission such as SIGHT, Pilot projects, R&D etc. to fund specific selected projects.

• There is no State-wise allocation made under the Mission.

Key Facts about Green Hydrogen

• Green Hydrogen is produced by the process of electrolysis, where water is split into hydrogen and oxygen using electricity generated from renewable sources like solar, wind, or hydropower.

• This process results in a clean and emission-free fuel that has immense potential to replace fossil fuels and reduce carbon emissions.

Challenges and Global Perspective

• Limited on-the-ground traction for green hydrogen noted in a World Economic Forum report.

• Key players adopting a 'wait-and-watch' approach.

• Cautionary notes from environmental organizations regarding potential land-use and water conflicts in green hydrogen production.