TERI's Proposal to Boost India's Green Hydrogen Market
Key Ideas
- TERI recommends establishing a central procurement agency in India, similar to SECI, to drive the development of a green hydrogen market for hard-to-abate sectors.
- The institute emphasizes the necessity of long-term contracts at competitive prices to ensure investor confidence and stimulate private sector participation.
- TERI advocates for a competitive procurement framework synchronized with expected demand, aiming to lower costs and foster a robust market for green hydrogen.
- The proposal includes creating special purpose vehicles (SPVs) for different industrial segments to manage green hydrogen procurement and reduce investment risks.
The Energy & Resources Institute (TERI) has put forth recommendations to accelerate the growth of a competitive green hydrogen market in India. TERI's report highlights the absence of a structured green hydrogen market due to insufficient demand for green hydrogen-derived goods and services. The institute suggests establishing a central procurement agency akin to the Solar Energy Corporation of India (SECI) to source green hydrogen for industries like steel and fertilizer. By ensuring long-term contracts at competitive prices, TERI aims to boost investor confidence and drive the decarbonization of hard-to-abate sectors. Additionally, TERI promotes conducting bidding rounds for hydrogen supply to coincide with industrial projects' commissioning, leading to cost reductions and market competitiveness. The proposal includes the creation of special purpose vehicles (SPVs) for each industrial segment to manage procurement through long-term contracts, reducing investment risks. TERI believes that by replicating the successful procurement model of SECI, India can establish a flourishing market for green hydrogen, supporting the transition to carbon-neutral inputs in various sectors.