India's Green Hydrogen Ambitions Face Cost Challenges Amid Export Dreams

India plans to boost its green hydrogen export from coastal hubs by 2030 but faces cost barriers. Despite being competitive, the high production costs hinder deals. The government's mission aims to overcome these issues with renewable projects, yet market gaps persist, affecting the sector's progress.

India's pursuit of becoming a global leader in green hydrogen faces cost challenges as the country aims to export more than half of its projected 5 million metric tons of renewable hydrogen by 2030. S&P Global Commodity Insights suggests that India's competitive edge may not be enough to overcome existing market barriers.

Coastal states like Odisha, Andhra Pradesh, and Tamil Nadu are emerging as prime hubs for hydrogen exports. Anri Nakamura, associate director at S&P Global Commodity Insights, highlighted that India's capacity to produce competitive green hydrogen positions it well for regions like Europe where consumption mandates are stronger.

However, the cost gap between production and market willingness to pay poses significant hurdles. Current production costs for renewable hydrogen exceed market willingness by over a dollar per kilogram, complicating deal negotiations and highlighting a crucial challenge for India's green hydrogen mission.

(With inputs from agencies.)