Cost of the electrolysers must be reduced to produce hydrogen at competitive rates
Green hydrogen, one of the major fuels to propel India’s clean energy transition, is produced by electrolysis of water done using clean electricity from renewable sources (wind, solar, etc).
The cost of electrolysers and electricity make up the largest share of the production cost, and thus, developing more efficient electrolysers will give a major boost to green hydrogen generation in India.
Apart from such costs, the other included costs are operating costs, transmission & distribution costs, wheeling costs for electricity, and the local duties and taxes in India.
At present, the cost of hydrogen production through electrolysis is high, ranging from $4.10-$7 per kg based on the technology used and the other associated costs (operating costs, transmission and distribution costs, wheeling costs for electricity and the local duties and taxes in India), according to a report by NITI Aayog.
Cost of production of green hydrogen in India
Source: Analysis by Rocky Mountain Institute, a non-profit organisation
Generally, electrolysers consume around 50-55 kilowatt-hours of electricity to produce a kilogram of hydrogen. The size of electrolysers ranges from a few kilowatts to several megawatts.
Alkaline and Polymer Electrolyte Membrane (PEM) electrolysers are the most widely used commercial technologies. In the former, a liquid alkaline electrolyte of sodium or potassium hydroxide is used. For PEM, a solid polymer membrane acts as a separator between the anode and the cathode compartments.
Solid oxide electrolysers use solid oxide or ceramic as an electrolyte to produce hydrogen (or carbon monoxide) and oxygen. Newer technologies, such as electrochemical (thermally activated chemical water-splitting process) use time cycles to separate the hydrogen and oxygen generation.
Anion exchange membrane electrolysis has positively charged functioning bodies that use a semi-permeable membrane to conduct the anions and reject the cations.
The cost of the electrolysers must be reduced to produce hydrogen at competitive rates. India has an edge regarding the levelised cost of energy for renewable sources such as solar and wind globally, even though it imports natural gas.
Improvement in the design and the development of new electrolyser techniques is a trend catching up globally. The creation of a local electrolyser production market would help India realise its engineering expertise and be recognised as an international market player in the segment. In the process, the country will be able to avail of the financial benefits of clean energy transitions.
Even though energy and electrolyser costs determine how green hydrogen will be priced in the long run, other financial components would help reduce its manufacturing costs. Around $3.2 per kg of levelised cost of hydrogen can be attained by exempting duty costs and lowering the goods & services tax as well as transmission and distribution fees.
The interstate transmission system costs for electricity produced from renewable energy sources such as solar and wind has been exempted by the Union Ministry of Power.
Read more: Green hydrogen can drive India’s transition to clean energy, combat climate change
The exemption of the costs has been covered for the programmes to be installed from June 30, 2025 onwards and includes the pumped hydroelectricity and battery energy storage projects.
Cutting down such costs for hydrogen production using renewable energy sources would help develop green hydrogen financials.
Apart from the above-mentioned exemptions, the charges for renewable energy for producing green hydrogen should be reduced.
The photoelectrolysis process using semiconductor photoelectrodes is a clean and green way of producing hydrogen.
The source of energy for splitting water in a photoelectrochemical cell is sunlight. This type of electrolysis generates dihydrogen, which can be used in fuel cells to produce energy and heat as well as to generate electricity.
In a report by the International Renewable Energy Agency, an intergovernmental organisation for renewable energy research and adoption, the following methods have been identified for photoelectrolysis:
Another option being explored at present is positioning the electrolyser close to offshore wind turbines for an offshore mode of operation. This would provide an opportunity for reducing losses and all-around costs and eliminate the requirement for alternating current rectifiers.
Offshore hydrogen would address environmental concerns through the creation of a zero-emission fleet. The offshore wind farms would benefit from becoming hydrogen refueling stations for transportation in the future.
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