Green Hydrogen Production in India

Green hydrogen is hydrogen gas produced by splitting water with electricity that comes from renewable sources such as solar, wind, or hydropower. The process leaves no carbon dioxide behind. That single property is why green hydrogen has moved from a niche industrial gas to the centre of India’s energy transition strategy. As of 2024 India launched the National Green Hydrogen Mission with a headline target of producing five million metric tonnes — five MMT — of green hydrogen per year by 2030, with the ambition of scaling to fifty MMT in the longer term as demand and infrastructure grow.

The science is straightforward and the engineering is where the challenge sits. Splitting water releases oxygen and captures hydrogen, but it needs a lot of electricity, and that electricity must itself be clean for the hydrogen to count as green.

How Electrolysis Works

Electrolysis passes a direct electric current through water containing a small amount of electrolyte. At the cathode, water molecules accept electrons and release hydrogen gas. At the anode, water gives up electrons and releases oxygen. The two gases are collected separately. If the electricity comes from a solar plant or a wind farm, the only inputs are sunlight, wind, and water, and the only outputs are hydrogen and oxygen.

Types of Electrolysers

Three electrolyser technologies dominate the market. Alkaline electrolysers are the oldest and cheapest, using a liquid potassium-hydroxide electrolyte. Proton-exchange-membrane, or PEM, electrolysers use a solid polymer membrane, respond quickly to variable power inputs, and pair well with intermittent renewables. Solid-oxide electrolysers operate at high temperatures and can be very efficient when waste heat is available, though the technology is still maturing.

The Colour Code of Hydrogen

The industry colour-codes hydrogen by how it is produced. Grey hydrogen comes from steam-methane reforming of natural gas with no carbon capture and is the dominant production method today. Blue hydrogen also uses natural gas but captures and stores the carbon dioxide. Green hydrogen uses renewable electricity and electrolysis. Pink or purple hydrogen uses nuclear electricity. Only green hydrogen avoids fossil-fuel inputs entirely, which is why climate policy treats it as a separate category.

Why Green Hydrogen Matters

Hydrogen is not just a fuel. It is an industrial feedstock and an energy carrier.

Industrial Uses

Refineries need hydrogen to remove sulphur from petroleum products. Fertiliser plants need hydrogen to make ammonia for urea. Steel makers can use hydrogen to reduce iron ore in place of coking coal. Today, almost all of this hydrogen is grey. Replacing it with green hydrogen would decarbonise large parts of Indian industry that have few other options.

Energy Storage and Hard-to-Electrify Sectors

Hydrogen can be stored and transported, which makes it useful as a buffer for renewable electricity that does not match demand in real time. Sectors that are hard to electrify directly — long-haul trucking, shipping, aviation, and certain industrial processes — can use hydrogen or hydrogen-derived fuels such as green ammonia and methanol.

The National Green Hydrogen Mission

The Cabinet approved the National Green Hydrogen Mission in January 2023 with an initial outlay of about nineteen thousand seven hundred crore rupees. The mission has three core components. The Strategic Interventions for Green Hydrogen Transition, or SIGHT, programme provides incentives for domestic electrolyser manufacturing and for green hydrogen production. Pilot projects target steel, mobility, and shipping. Research and development support covers the supply chain.

Targets and Strategy

The headline production target is five MMT of green hydrogen per year by 2030, supported by an estimated one hundred and twenty-five gigawatts of additional renewable capacity dedicated to electrolysis. The long-term industry vision extends towards fifty MMT as use cases scale up. The government expects the mission to attract around eight lakh crore rupees of investment, abate fifty million tonnes of carbon dioxide emissions per year by 2030, and create six lakh jobs.

For context on related infrastructure and policy, see our explainers on green hydrogen in India, the National Green Hydrogen Mission, and hydrogen energy.

The Cost Problem

Green hydrogen is still expensive compared to grey hydrogen. Indian green hydrogen costs roughly three hundred to four hundred rupees per kilogram, while grey hydrogen costs around one hundred to one hundred and fifty rupees. Bringing the cost of green hydrogen below two hundred rupees per kilogram is widely seen as the threshold at which it becomes competitive without subsidy.

Two factors drive the cost: the price of renewable electricity, which already favours India, and the capital cost of electrolysers, which is falling but remains the larger barrier. Domestic manufacturing under SIGHT, scale-driven cost reductions, and innovations like high-pressure electrolysis are expected to close the gap over the decade.

Risks and Open Questions

Hydrogen is the smallest molecule and leaks easily, which complicates storage and transport. Pipelines and tanks need specialised materials. Hydrogen vehicles need refuelling networks that do not yet exist. Industrial conversion projects in steel and fertilisers require long-term offtake agreements to justify the capital expense. Water consumption for electrolysis is non-trivial and matters in regions facing water stress.

These are solvable problems, but they will not solve themselves. Sustained policy support, predictable demand, and continued cost reductions all need to line up for the mission’s targets to land.

FAQs

What is green hydrogen?

Green hydrogen is hydrogen gas produced by splitting water through electrolysis using electricity from renewable sources, resulting in no direct carbon emissions.

How does electrolysis produce hydrogen?

Electrolysis passes an electric current through water, separating it into hydrogen at the cathode and oxygen at the anode. When the electricity comes from renewables, the hydrogen is green.

What is India’s green hydrogen target?

The National Green Hydrogen Mission targets five million metric tonnes per year of green hydrogen production by 2030, with longer-term aspirations to scale further as demand grows.

What is the National Green Hydrogen Mission?

A flagship mission approved in 2023 with an outlay of around nineteen thousand seven hundred crore rupees to incentivise electrolyser manufacturing, green hydrogen production, pilot projects, and research.

Why is green hydrogen still expensive?

Because electrolysers carry high capital costs and renewable electricity dedicated to electrolysis is still being scaled up. Costs are falling but remain higher than grey hydrogen from natural gas.

What is the difference between grey, blue, and green hydrogen?

Grey hydrogen is made from natural gas with no carbon capture. Blue hydrogen is from natural gas with capture and storage of the emitted carbon dioxide. Green hydrogen is from electrolysis powered by renewables.

Where can green hydrogen be used?

In oil refining, fertiliser production, steel making, long-haul trucking, shipping, and as a buffer for renewable electricity that does not match demand in real time.

Will green hydrogen replace fossil fuels?

It will replace fossil hydrogen and decarbonise specific industrial and transport applications. It is one part of the energy transition, not a single replacement for all fossil fuels.