Renewable-Led Hydrogen Cost Could Fall Over 50% by 2030; 5-Fold Demand Up by 2050: TERI

The demand for hydrogen in India can grow five-fold by 2050. Further, by 2030, the costs of “green hydrogen” from renewables will fall more than 50 per cent and start to compete with hydrogen from fossil fuels.

These were the findings of The Energy and Resources Institute (TERI) report launched by Dr Rajiv Kumar, Vice Chairman, Niti Aayog in a digital event. The report, titled “The Potential Role of Hydrogen in India”, was created under TERI’s Energy Transitions Commission (ETC) India programme.

Commenting on the report, Will Hall, Fellow, TERI, and one of the report authors, said that “this is a first-of-its-kind, cross-sector assessment of how hydrogen technologies can support the transition to a zero-carbon energy system in India.”

The report says that hydrogen needs to be targeted in sectors where direct electrification is not possible. These are heavy-duty, long-distance transport sectors, some industry sectors, and long-term seasonal storage in the power sector.

In transport, battery electric vehicles (BEV) will become competitive across all segments, except for very long-distance, heavy-duty transport, which could be fuelled by hydrogen.

In the power sector, hydrogen could provide an important source of seasonal storage for variable renewables like solar and wind energy. Large amounts of seasonal storage will become necessary only when the share of wind and solar in total generation reaches very high levels (60-80 per cent).

Further, green hydrogen production could require around 1000 TWh of renewables-based electricity by 2050, placing further pressure on power system decarbonisation.

Praising the report, Dr Kumar expressed a lot of support for growth of the hydrogen sector. “In Government of India, we see hydrogen as our next big sunrise sector and a transition to the hydrogen economy as the way forward for India. I therefore hope that some of my optimism about the sector will prevail in combination with a coordinated policy thrust from us.”

“The falling cost of hydrogen will drive its uptake, with initial scale-up being driven by collaborations between progressive public and private players… India has an opportunity to grow an economically competitive low carbon hydrogen sector that can spur job growth reduce energy imports, whilst drastically reducing emissions,” said Dr Ajay Mathur, Director General, TERI.

Adding to it, Lord Adair Turner, Co-Chair, ETC said, “the costs of making green hydrogen from electrolysis are falling fast, with $2 per kg production costs likely to be achieved before 2030. So, it is essential to identify what role hydrogen could play in India, and how Indian industry can seize the economic opportunities arising.”