Green Hydrogen and the Global Race
Green hydrogen — hydrogen produced by electrolysis using renewable electricity — is emerging as a strategic fuel for decarbonising hard-to-electrify industries (steel, fertilisers, chemicals). Falling renewables costs, technological advances in electrolysers, and national hydrogen missions have triggered a global race in electrolyser manufacturing, supply chains and hydrogen hubs. China leads in alkaline electrolyser manufacturing, while India seeks to build domestic capacity and export-ready hydrogen hubs.
Introduction
Context & Background
Key Points
- •What makes hydrogen ‘green’? Hydrogen is called green when the electricity used for electrolysis comes from renewable sources (solar, wind, hydro). If fossil-based electricity is used, hydrogen is grey (or blue if carbon capture is added).
- •Why hydrogen matters: It can decarbonise processes and sectors where electrification is hard — high-temperature heat in industry, ammonia production for fertilisers, refinery operations, and heavy transport. It also acts as an energy carrier and seasonal storage medium.
- •Electrolysers are core: Electrolysers are to hydrogen what solar modules are to solar power — they are the main equipment that produces hydrogen. Improving electrolyser cost, efficiency and durability is central to making green hydrogen economical.
- •Major electrolyser types (simple): Alkaline (ALK) — mature, cheaper, best for continuous operation; Proton Exchange Membrane (PEM) — flexible with variable renewables, higher purity, but currently costlier due to precious metal catalysts; Solid Oxide (SOE) — high-temperature, promising efficiency but still nascent; Anion Exchange Membrane (AEM) — emerging, aiming to combine low-cost materials with PEM-like flexibility.
- •China’s role: By recent counts China dominates global ALK electrolyser manufacturing capacity (large share of global capacity), and has scaled production quickly. This creates both supply risks and opportunities for price-competitive equipment.
- •Why China may not dominate everything: PEM and next-gen electrolysers require different critical materials (platinum, iridium, titanium) and advanced know-how; Western and Japanese firms have strengths here. Also, hydrogen systems integration (storage, transport, end-use purity) is complex and strategic.
- •India’s policy push: National Green Hydrogen Mission (2023) with incentives, PLI-style support for electrolysers, targets (multi-million-tonne goals), hydrogen hubs (Gujarat, Rajasthan, Tamil Nadu) and ties with industry players are intended to build a domestic hydrogen ecosystem.
- •Beginner analogy: Think of building a green hydrogen industry like building an automobile industry: you need car factories (electrolyser plants), roads and petrol stations (pipelines, storage, refuelling), trained workers and markets (industrial offtake, exports).
Common Electrolyser Types — Simple View
| Electrolyser Type | Key Features | Strengths / Weaknesses (beginner) | Bookmark |
|---|---|---|---|
| Alkaline (ALK) | Mature alkaline chemistry; uses liquid electrolyte (potassium hydroxide). | Strengths: Cheaper, proven at scale. Weaknesses: Less suited to rapid changes in renewable power. | |
| Proton Exchange Membrane (PEM) | Uses solid polymer membrane; tolerates variable electricity supply. | Strengths: Flexible with renewables, high purity hydrogen. Weaknesses: Costly due to precious metal catalysts. | |
| Solid Oxide (SOE) | High-temperature electrolysis (700–900°C); efficient if heat is available. | Strengths: High theoretical efficiency. Weaknesses: Early-stage, materials & durability challenges. | |
| Anion Exchange Membrane (AEM) | Emerging; aims to use low-cost materials with PEM-like flexibility. | Strengths: Potential low-cost solution. Weaknesses: Still under R&D, commercial maturity pending. |
India’s Strategic Advantages & Gaps (Simple)
| Area | Advantage (India) | Gap / Challenge | Bookmark |
|---|---|---|---|
| Renewable Energy | Very low solar & wind tariffs — abundant cheap renewables. | Needs grid, storage and firming solutions for large electrolysis demand. | |
| Market Demand | Large fertilizer, refinery and industrial sectors that can use hydrogen. | Early off-take markets and blending mandates still limited. | |
| Manufacturing | Strong engineering, large firms entering electrolyser manufacturing. | PEM & advanced electrolyser tech gap; dependence on imports for some components. | |
| Geopolitics | Trusted partner for many countries (West Asia, EU, Japan). | Competition from low-cost Chinese ALK electrolysers; need mineral partnerships. |
Related Entities
Impact & Significance
- •Decarbonisation potential: Green hydrogen can cut emissions in sectors where direct electrification is infeasible — helping countries meet net-zero targets and reduce CO₂ from industrial processes.
- •Energy security & trade: Domestic green hydrogen can reduce fossil fuel imports; if cost-competitive, it can become an export commodity (e.g., ammonia, liquid hydrogen) earning foreign exchange.
- •Industrial transformation: Hydrogen-based feedstocks (green ammonia for fertilisers) can modernise legacy industries and spur new manufacturing value chains (electrolyser factories, compressor makers, storage solutions).
- •Employment & Economic Opportunity: Building electrolyser plants, hydrogen hubs and associated infrastructure creates manufacturing and construction jobs and strengthens high-tech engineering capabilities.
- •Strategic/Geopolitical Impact: Countries that develop domestic hydrogen ecosystems become trusted clean-energy partners; supply-chain diversification (vs dependence on a single supplier) has strategic benefits.
Challenges & Criticism
- •High current costs: Electrolysers, balance-of-plant and renewable electricity costs still make green hydrogen more expensive than fossil-based routes in many applications — necessitating subsidies, incentives or mandates in early years.
- •Critical mineral dependence: Advanced electrolysers (PEM) depend on precious metals (platinum, iridium) and specialized materials. India has limited domestic reserves of these critical minerals.
- •Infrastructure gaps: Large-scale hydrogen requires new storage (compressed/liquefied), pipelines or hydrogen carriers (ammonia, methanol), refuelling stations, and port facilities for exports.
- •Demand-signal uncertainty: Industry offtake (steel, fertiliser, shipping) is uncertain in scale and timing — investors face demand risk while building supply capacity.
- •Safety & standards: Hydrogen handling requires tight safety standards and regulatory frameworks for production, transport and storage.
- •Competition & market dynamics: Cheap Chinese ALK electrolysers can undercut domestic industry on price; without innovation India may struggle on cost metrics alone.
- •Financing & investment risk: Large upfront capital is needed for electrolysers and renewables; price volatility and uncertain policy continuity are investor concerns.
Future Outlook
- •Scale electrolyser manufacturing: Use PLI-style incentives, technology partnerships and joint ventures to build large-capacity ALK & PEM plants and localise critical components.
- •Secure critical minerals: Pursue strategic resource diplomacy (Africa, Australia, Latin America) and recycling/alternate-material pathways to reduce dependence on scarce metals.
- •R&D & innovation: Invest in next-gen electrolyser R&D (AEM, SOE), catalyst recovery, low-precious-metal designs and systems-integration to lower total system costs.
- •Build demand via policy: Create guaranteed demand through mandates — e.g., hydrogen blending in refineries, green-ammonia procurement, low-carbon steel standards and public procurement preferences.
- •Co-locate renewables & electrolysers: Develop hydrogen hubs where cheap renewables, industrial clusters and port/export facilities co-exist for economies of scale (e.g., Gujarat, Rajasthan, Tamil Nadu examples).
- •Develop transport & storage: Invest in pipeline corridors, salt-cavern or pressurised storage solutions, ammonia carriers and conversion terminals to enable domestic use and exports.
- •International cooperation: Enter technology partnerships, standards harmonisation and long-term offtake agreements with importers (EU, Japan, Korea, Gulf) to de-risk investments and secure markets.
- •Standards & safety: Create clear safety codes, certification regimes and workforce training to manage hydrogen at scale safely.
UPSC Relevance
- • GS-3: Alternate energy sources, energy security, industrial decarbonisation, manufacturing policy.
- • GS-2: International cooperation, strategic resource diplomacy and public policy design.
- • Essay: Technology for sustainable development, green growth strategies.
Sample Questions
Prelims
With reference to green hydrogen production, consider the following statements:
1. Green hydrogen is produced by electrolysis using electricity from renewable sources.
2. Alkaline electrolysers are better suited than PEM electrolysers to handle large fluctuations in renewable electricity supply.
3. The National Green Hydrogen Mission aims to encourage domestic electrolyser manufacturing.
Answer: Option 1, Option 3
Explanation: Statement 1 is correct. Statement 2 is incorrect — PEM electrolysers handle fluctuating renewable inputs better than alkaline electrolysers. Statement 3 is correct.
Mains
Examine the strategic importance of green hydrogen for India. Identify major technological, infrastructural and policy challenges and suggest measures to make India a competitive player in the global hydrogen economy.
Introduction: Green hydrogen can decarbonise hard-to-electrify sectors and enable new industrial value chains; it is central to energy transition strategies.
Body:
• Strategic importance: Energy security, industrial decarbonisation, export potential and geopolitical leverage.
• Challenges: High cost, critical mineral dependence, infrastructure gaps (storage, pipelines), demand uncertainty and competition from low-cost suppliers.
• Suggested measures: Scale domestic electrolyser manufacturing (PLI), secure minerals via diplomacy, invest in R&D (PEM/AEM/SOE), create demand signals (mandates, public procurement), build hydrogen hubs and export infrastructure, and develop safety & standards frameworks.
Conclusion: With targeted policy support, strategic partnerships and technology investments, India can transition from import-dependence to a competitive producer and exporter of green hydrogen and derivatives.