Oil refiner and petroleum products retailer, Indian Oil Corporation, plans to set up several hydrogen production units on pilot basis, testing out different pathways of producing the gas.

It is asking for slashing of GST on the fuel and to bring fuel-cell powered vehicles under the FAME-II scheme of the government, which gives financial incentives for electric vehicles.

The company’s Director-R&D, SSV Ramakumar, told Business Line that IOC has been at the fuel gas since 2005, when it set up its first hydrogen dispensing station at its R&D centre in Faridabad, near Delhi.

Last year, it experimented with doping compressed natural gas with hydrogen. Today, 50 buses in Delhi are being fuelled by the ‘H-CNG’, which has 18 per cent hydrogen content. It set up a small, 4 tonne-per-day hydrogen plant at a bus depot in Delhi for this purpose.

The idea was to reduce tail-pipe emissions of the buses, but it also ended up in higher fuel efficiency. The 50 buses have run on BS-IV compliant engines, but have met BS-VI standards of emissions, Ramakumar said.

The next step was taken in December 2020, when the company tendered for 15 fuel-cell powered buses, with the condition that the fuel cells must be entirely India-made. The buses are expected to ply in the second half of 2021.

Since running these buses requires hydrogen, IOC is setting up a plant, whose capacity could be anywhere between 200 tonnes and 400 tonnes per day. Hydrogen would be produced by the traditional, ‘steam methane reforming’ route, in which methane reacts with steam in the presence of a nickel catalyst to produce hydrogen and carbon dioxide. Not the best way to produce the gas, but good enough to get going.

Now, this ‘grey hydrogen’ will be a benchmark for three other hydrogen pathways that IOC is planning to explore to produce the gas – water electrolysis, biomass gasification and converting compressed biogas into hydrogen. All these three are absolutely green and will give hydrogen of ‘five-nine purity, or 99.999 per cent.

Ramakumar said that biomass gasification – IOC has joined hands with the Indian Institute of Science, Bengaluru to develop this technology — is the most economical pathway to the hydrogen economy, Ramakumar said.

Five pilot plants

Apart from these, IOC is leading an initiative of the Ministry of Petroleum and Natural Gas, to bring down the cost of hydrogen. Accordingly, IOC is drawing up an action plan under which the oil marketing companies in India (IOC, HPCL, BPCL etc) will put up five pilot projects for the production of green hydrogen (hydrogen production without emissions of greenhouse gases or pollutants).

The plan will be submitted to the Ministry in a month. All the five plants would come into being within the next two years, Ramakumar said.

Duty slash

IOC has recommended to NITI Aayog that the GST rate on hydrogen, 18 per cent today, should be slashed. It has said that grey hydrogen could be taxed at 5 per cent, blue hydrogen (where incidental CO2 emissions during hydrogen production are captured, used or stored away) at 2 per cent, and zero GST on green hydrogen. IOC also wants FAME-II incentives — after all, they are electric vehicles too.