Green Hydrogen Economy
Anbarasan Subramanian
Contracts Manager| Contracts Compliance| GRC Professional| Independent Director
Throughout history, economies have been driven by various factors, from agriculture in ancient times to the dominance of oil in the 20th century. The transition to the present has seen the rise of knowledge and data economies, where information and innovation play pivotal roles. Looking ahead, the potential future drivers include the shift towards a green economy, driven by renewable energy and sustainability efforts, as well as the growing importance of healthcare and the exploration of space resources. These drivers reflect evolving societal needs, technological advancements, and global challenges, shaping the trajectory of economic development in the years to come.?
Hydrogen, especially green hydrogen, is emerging as a prominent contender for future fuel solutions. The green hydrogen industry focuses on producing hydrogen using renewable energy sources like wind, solar, or hydroelectric power, rather than fossil fuels. Green hydrogen is created through electrolysis, splitting water into hydrogen and oxygen using electricity. This electricity is generated from renewable sources, rendering the entire process carbon-free. One of its main advantages is its potential to decarbonize various sectors such as transportation, industry, and heating. Hydrogen can serve as a clean fuel for vehicles, as a feedstock for energy-intensive industrial processes like steel and ammonia production, and as a means of storing renewable energy for later use.
The green hydrogen industry is still nascent but experiences rapid growth and investment as countries and industries strive to reduce their carbon emissions and shift to more sustainable energy sources. Governments worldwide are implementing policies and incentives to support the development of the green hydrogen sector, including funding for research and development, subsidies for hydrogen production and infrastructure, and setting targets for hydrogen use across different applications.
However, challenges remain, such as the high cost of electrolysis technology, the need for infrastructure for hydrogen production, distribution, and storage, and ensuring the scalability of renewable energy sources to meet the demand for hydrogen production. Despite these hurdles, the green hydrogen industry holds great promise as a crucial component of the transition to a low-carbon economy.
The future market
PwC’s analysis projects a consistent increase in hydrogen demand up to 2030, fueled by specialized uses in sectors like industry, transportation, energy, and construction. Collaborative initiatives across these sectors are expected to lead to the formation of new partnerships for hydrogen project development. The cost of producing hydrogen is predicted to drop by about 50% by 2030 and will continue to decrease, albeit more gradually, until 2050. By mid-century, regions with abundant renewable resources, including parts of the Middle East, Africa, Russia, China, the US, Australia and India, could see green hydrogen production costs between €1 and €1.5/kg. Conversely, areas with scarce renewable resources, such as much of Europe, Japan, or Korea, may face costs of around €2/kg, positioning them as probable importers of green hydrogen. Even regions with ample renewable resources but high population density might turn to imports due to limited land availability for direct green electricity production and hydrogen conversion. Large nations like the US, Canada, Russia, China, India, and Australia could see both competitive and less competitive hydrogen production regions, potentially leading to domestic trade. Global export and import centers for green hydrogen are anticipated to emerge, akin to the existing oil and gas trade hubs, but with new participants from regions rich in renewables.
India's efforts in green hydrogen
India has been making considerable progress in the green hydrogen sector. Here are some of the key initiatives and plans:
These efforts are part of India’s broader strategy to position itself as a leader in the hydrogen economy and achieve its goal of becoming energy-independent by 2047 and achieving Net Zero by 2070.
Green hydrogen value chain
The green hydrogen value chain involves several key parties:
Each party plays a crucial role in the value chain, contributing to the growth and development of the green hydrogen industry.
Legal and regulatory regime
Currently, there is no dedicated legislation for green hydrogen in India.?It is regulated by existing laws and regulations. Apart from being common to all industries' regulations, the following list of statutes and their amendments governs the hydrogen industry. Those are
Some of the Ministries involved in regulating the industry
Some of the Authorities involved in regulating the industry
Last year the Bureau of Indian Standards (BIS) issued a comprehensive list comprising 23 Indian Standards focused on hydrogen, reflecting its versatile applications and significance. These standards cover various facets of hydrogen, providing directives and specifications tailored to its distinct properties and uses. They encompass safety protocols for hydrogen storage in cylinders, specifications for hydrogen fuel in road vehicles, safety guidelines for hydrogen generators, purity standards, and handling protocols for liquid hydrogen. This initiative underscores BIS's dedication to setting stringent benchmarks and guaranteeing the safety, quality, and effectiveness of hydrogen-related operations and applications spanning multiple industries.
The notification of the Green Hydrogen Standard for India notified that Bureau of Energy Efficiency (BEE), Ministry of Power shall be the Nodal Authority for accreditation of agencies for the monitoring, verification and certification for Green Hydrogen production projects.
The legal and regulatory regime for green hydrogen in India is evolving, with specific rules and regulations expected to be developed as the sector grows.?
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About Newtrace
Newtrace is an emerging startup in the green hydrogen sector based in Bangalore, India. Here are some key details about Newtrace:
Founding: The company was launched in 2020.
Total Funding: $6.7M
Latest Funding Round: $5.7M, Seed, May 24, 2023
Annual revenue of NewTrace is $12.9K as on Mar 31, 2023
NewTrace's valuation is $24.8M
Investors: Peak XV Partners, IKP Knowledge Park, Aavishkaar Capital,
Sameer Brij Verma, Speciale Invest, Micelio fund and 5 Others
Mission: Newtrace is on a mission to enable cost-effective and reliable access to green hydrogen through their massively scalable electrolyzer technology.?This is aimed at accelerating the decarbonization of mobility, industrial, energy, and chemical sectors.
Innovation: They specialize in the production of green hydrogen and have developed an innovative electrolyser management system that consolidates equipment data into a fully automated platform.?This empowers clients to efficiently generate green hydrogen at a competitive price.
Future Plans: The company aims to deploy its electrolysers in sectors such as refineries, fertilizers, chemicals, steel and cement, and transportation.?It is also looking to expand its solution into providing technology for long-term storage and conversion of green hydrogen and ammonia.
Newtrace is one of the many startups contributing to the growth of the green hydrogen industry in India.
Further Readings:
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