India's Green Hydrogen Goal SHIFTED? Global Hurdles Force Major Delay – What Investors Need to Know!

India's ambitious target of establishing 5 million tonnes of green hydrogen capacity by FY30 may face a delay, potentially being pushed to FY32. This adjustment, announced by Renewable Energy Secretary Santosh Kumar Sarangi, is attributed to significant global policy uncertainties and anticipated delays in implementing green mandates within the international shipping industry. Key factors influencing this decision include policy hesitations in Europe, a crucial export market, a one-year deferral of the International Maritime Organisation's (IMO) green fuel mandate, and delays in the European Union's 'Renewable Energy Directive-3'. Despite the potential shift in the long-term target, the government expects approximately 3 million tonnes of annual green hydrogen capacity to be operational by FY30. The Ministry of New and Renewable Energy is planning the next round of tenders under the Green Hydrogen Mission to aggregate demand for green methanol from the shipping industry, which is expected to drive adoption without direct subsidy requirements due to the IMO mandate. Additionally, the trajectory for tendering 50 GW of renewable energy projects might also be reassessed based on actual demand.

Impact This news indicates a potentially slower rollout for green hydrogen production, which could affect investment decisions in the sector and related industries. It suggests a need for greater clarity and stability in global and domestic policies to accelerate the transition to green fuels. The impact on the pace of decarbonization and related capital expenditure is rated at 6/10.

Difficult Terms Green Hydrogen: Hydrogen produced from water electrolysis powered by renewable energy sources, making it a clean fuel. International Maritime Organisation (IMO): A specialized agency of the United Nations that regulates shipping. Renewable Energy Directive-3 (RED III): A directive from the European Union setting renewable energy targets and policies. Green Methanol: A form of methanol produced using renewable energy and sustainable feedstocks, used as a low-carbon fuel for shipping.