Clean energy: Govt should create market for clean hydrogen

Govt should create market for clean hydrogen

Clean hydrogen can turn into a fuel of the future and be used to power the heavy automobiles, power, and industrial sector only when large scale production becomes possible.

The government should create the demand-pull for hydrogen and then address the supply side by enabling investments, primarily through the public sector units to begin with, so as to create the market for clean hydrogen.

Creating a demand-pull

According to Atanu Mukherjee, President and CEO of MN Dastur & Co and Dastur Energy, some of the ways of creating the demand-pull for hydrogen would be through hydrogen blending in natural gas grids and generation of hydrogen-based steel through coal gasification. This apart, fuel switching in chemical plants and programs for heavy transport fuel cell vehicles and infrastructure should be an integral part of the policy design.

“There is a need to create the demand side by creating the market without which the consumption or use of these fuels will not happen. The policies in terms of investment credits, mandates in terms of use of certain percentage of hydrogen as green hydrogen allow you to create markets at a certain scale. The second is supply side in terms of enabling investments through PSUs to start with, investments through credits like in case of carbon capture and also to create mechanisms to draw in investments from outside. Once the demand side and supply is addressed then as scale improves and consumption improves it drives down the costs further,” Mukherjee told BusinessLine.

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