The National Green Hydrogen Mission (NGHM), like other missions, envisions making India a global leader in hydrogen, with an initial emphasis on green hydrogen. The government is also giving it a major push. However, there are challenges, particularly that of pricing of green hydrogen vis-a-vis conventional alternatives.
Since the policy mandates it, those in the business are focusing on its use in refineries and exporting its derivatives. This has also been pointed out in a recent joint study, by the Hydrogen Association of India and ARUP, called ‘Unlocking the Role of Hydrogen for Mobility in India’.
“The core question facing India’s hydrogen eco-system today is clear: Where is the domestic demand for green hydrogen, especially when its production cost alone hovers around ₹400/kg, as seen in Indian Oil Corporation Ltd’s recent price discovery? The supply-demand imbalance is real and pressing. In response, many hydrogen developers are now exploring exports of green hydrogen derivatives such as green ammonia and green methanol, which offer more immediate economic viability due to global mandates and offtake readiness,” it said.
“However, India cannot afford to rely solely on exports. For a truly self-sustaining hydrogen economy, domestic demand must be stimulated. This calls for a pragmatic, phased approach in identifying the production pathways and enhancing the spectrum of the end applications: What remains underexplored — but holds transformational potential — is hydrogen’s application in mobility,” it pointed out.
Mobility potential
Clearly, role of hydrogen in mobility, according to the study, offers a long-term opportunity for transition to cleaner and more sustainable fuel.
“Hydrogen can be produced from a variety of sources — both fossil-based and renewable — and delivers high energy content with significantly lower emissions, especially when used in Fuel Cell Electric Vehicles (FCEVs),” the study authored by RK Malhotra President, Hydrogen Association of India, and Sachin Chugh, Energy & Hydrogen Lead, ARUP, observed.
It is a fact that India’s green hydrogen plans are making slow progress as there is not much clarity on the global demand for green ammonia, as the cost of producing Green hydrogen makes it economically unviable, resulting in uncertainty over its pricing.
But, why are we only talking of green hydrogen? Why not start with grey hydrogen, then move to blue and then subsequently reach green?
Reportedly, grey hydrogen is the most common form and is generated from natural gas, or methane. It is done through steam reforming process, which refiners can easily do.
The hydrogen is labelled ‘Blue’ whenever the carbon generated from steam reforming is captured and stored underground through industrial carbon capture and storage (CSS). Across industries CSS is being attempted at various levels.
Then there is green hydrogen or “clean hydrogen”, which is produced by using clean energy from surplus renewable energy sources such as solar or wind power, to split water into two hydrogen atoms and one oxygen atom through a process called electrolysis.
According to reports, it currently makes up about 0.1 per cent of overall hydrogen production. “Green hydrogen is obviously expensive at this point of time,” Malhotra acknowledges. Today, the base point is the discovered price by Indian Oil Corporation through tendering process for its Panipat Refinery at ₹397 a kg, over which some additional cost will be incurred for supply and distribution, he added.
“So it cannot be supplied at anything less than ₹450 or so. We do hope that this cost of Green hydrogen would come down in due course,” he said.
Meanwhile why not look at grey hydrogen, said Malhotra adding that the refineries can actually produce grey hydrogen from natural gas which may cost somewhere between ₹175-200 a kg and sold at about ₹250 a kg.
So what should be the right approach, if India wants to push hydrogen as the sought after fuel? Besides, making it affordable there will be need to create infrastructure too.
Phased approach
Most experts too believe that the right approach should be to gradually move to grey to blue to green. Malhotra and Chugh too, say that in their study.
“While India rightly pursues green hydrogen as the end goal, a pragmatic, phased approach is essential to accelerate the hydrogen transition across the transport sector. Recognising that infrastructure, cost, and technology maturity vary significantly across regions and vehicle categories, India must adopt a “multi-colour hydrogen strategy” that leverages grey, blue, and green hydrogen in a targeted and sequential manner,” the study states.
Grey hydrogen can serve as an important launchpad in mobility, a target for carbon proponents. According to the study, it can be used in retrofitted hydrogen ICE trucks and other pilot deployments where industrial grey hydrogen is already available. This helps aggregate early demand, reduce upfront costs, and build technical familiarity.
Blue hydrogen should be the mainstay of medium-term adoption, especially for both H₂ ICE and FCEV platforms, as it delivers deep emission reductions and is more readily scalable with CCS-ready infrastructure.
And then comes green hydrogen. This must be strategically reserved and deployed in high-impact zones — such as urban corridors, export-oriented hydrogen hubs, and ESG-sensitive applications like public transit — while ramping up electrolyzer capacity and renewable energy integration, points the study.
While production strategy is one aspect, another important area is refuelling infrastructure, if hydrogen has to become part of daily life.
The study proposes a five-pronged refuelling strategy: Embed hydrogen into Gati Shakti Master Plan; conditional viability gap funding (VGF) plus public-private partnership; cluster-based rollout via hydrogen valleys; ownership innovation – franchise + anchor Models; indigenization with strategic licensing.
If hydrogen has to be promoted as the next fuel, the task ahead is not easy. A clear strategy is the need of the hour.