NEW DELHI (Reuters) -India’s green hydrogen ambitions are faltering due to slow project commissioning, driven by inadequate infrastructure and unclear demand signals, a U.S.-based energy think tank said in a note on Friday.
Despite strong investor interest, 94% of the country’s planned green hydrogen capacity remains at the announcement stage, the Institute for Energy Economics and Financial Analysis said in the note, citing higher costs as one of the main deterrents for buyers.
The government launched the National Green Hydrogen Mission in 2023 with a 197 billion rupee ($2.2 billion) budget, targeting 5 million metric tonnes per annum (MMTPA) of production by 2030.
However, a top clean energy department official said earlier this week that India is likely to achieve that target only by 2032.
IEEFA said India has 158 projects under development, but only 2.8% are operational and 0.1% under construction as of August.
Announced projects total 11.2 MMTPA — more than double the target — but progress is hampered by weak demand, along with a lack of storage and transport facilities, IEEFA added.
Industry estimates put India’s total hydrogen demand at 15–20 MMTPA by 2030, with green hydrogen potentially meeting 25% to 33% of that if policies spur uptake in steel, chemicals, transport and exports, the note said.
The report calls for hydrogen purchase obligations, demand aggregation and hydrogen hubs with shared infrastructure to cut costs and accelerate adoption.
“Policy nudges and high-level decarbonisation goals will likely drive demand, but sustained uptake needs global collaboration and concrete domestic steps,” said Charith Konda, energy specialist at IEEFA.
(Reporting by Sethuraman NR; Editing by Vijay Kishore)
