The Quad platform is eyeing India as a global manufacturing hub for green hydrogen. The development is being viewed as a measure to develop a clean energy market that is outside the influence of China, which already controls a sizeable share of the solar and electric vehicle (EV) manufacturing and supply chains.
The Quadrilateral Security Dialogue (Quad) is a group of four countries — the US, Australia, India and Japan. Under it, the Quad Energy Ministers plan to catalyze efforts to deploy clean hydrogen, minimize methane emissions, and develop a 10-year clean energy supply chain roadmap.
“Quad is exploring avenues to establish a base for manufacturing, distribution and storage of green hydrogen in India. The reasoning is that India, with its economical labour force and land for manufacturing, is an ideal location. Other members in the group can pitch in with technology and investments,” said a top government official.
Investment in India
Countries such as the US and Japan already have electrolyzer technologies and are also ready to invest in India. As for the markets, many countries, including Germany and Japan, have evinced interest in importing green hydrogen from India, the official added.
Another official said: “Already, there are concerns over concentration of the entire supply chains of EVs and solar with China, giving it an advantage over others. A global green hydrogen market in India will be an apt alternative to maintain balance in the Indo-Pacific region.” The Quad platform will also work on stimulating market demand to promote trade in green hydrogen in the Indo-Pacific region, he added.
Noted scientist and Niti Aayog Member, VK Saraswat, feels India has the potential to become a hub for green hydrogen. “One, we have the knowledge to produce it, and second, we have our sights on long term energy transition. The handicap is that we are not manufacturing electrolyzers,” he added.
Asked if Quad can aid India in this transition, he said: “We can make use of Quad platform for setting up small modular reactor (SMR) plants. The US and Japan have already made progress on SMRs. Collaboration is possible under Quad as it will help in dealing with several restrictions that are there.”
Another possibility is to reduce electrolyzer costs. This will also come through collaboration. Countries like Denmark, Norway, Sweden and Japan have good electrolyzer technologies. This will be a good input to bring down costs, which will come through technology and scale. India should use technology from non-Chinese sources like Sweden, France, US, Japan, he explained.
“For maximum efficiency, we should work on solid oxide electrolyzer cells (SOEC). For producing 1 kg of hydrogen around 50-52 units of power are used, but with SOCE, it comes down to less than 40 units,” said Saraswat.
Need for a green hydrogen
Hemant Mallya, who leads the Industrial Sustainability and Competitiveness team at The Council for Energy, Environment and Water (CEEW), pointed out that investments in oil and gas have been declining over the years, more recently so, as the shift is towards green energy.
“Which means that in future there will be less oil and gas available, whereas transition is lacking. We feel that is a strategic threat to India and it is not in our control. About 45 per cent of investments that go into oil and gas development come from the EU and US, and they have made up their mind that money will not go into oil and gas, which we do not control,” he added.
To a large extent on green hydrogen, India is neck-to-neck with other countries, as the traditional electrolyzer technology (alkaline) has been around for a long time. However, it has hit its deficiency potential. What India needs now, and where the country can lose the race, is if India does not enhance technologies, the existing ones or build new ones for electrolyzers, he explained.
“The challenges internally will be to deploy technology and infrastructure at scale. It is a game of speed. Whoever catches up first, captures the market and that allows you to scale up more like that of a Facebook or Twitter. Most important thing for India is to create that early stage market and gain volumes as quickly as possible. The ripple effect will allow us to get to roughly $1 per kg of green hydrogen, at that point it will become cost competitive with coal,” Mallya emphasized.
On the China issue, Mallya said: “Like EVs and solar, China is already ahead even in green hydrogen. They are deploying 10-15 gigawatts of eletrolyzer manufacturing capacity as well as substantial green hydrogen capacity. Therefore, they will win on cost. Where India needs to win is in quality of manufacturing. Can we look at manufacturing specifically and have a target-based ecosystem development approach?”
He further said: “We do need to be mindful of where the finances are coming because the capital is at high cost. We have to bring down the cost of capital.”
During its first in-person summit in September 2021, Quad discussed a clean hydrogen partnership for creating a robust and economical value chain. The initiatives will focus on identifying and developing delivery infrastructure for safe and efficient transport, storage and distribution of green hydrogen to end users.
In May this year, during the second in-person meeting in Tokyo, the Quad Climate Change Adaptation and Mitigation Package (Q-CHAMP) was launched. It includes work on clean energy cooperation in clean hydrogen and methane emissions from the natural gas sector.
The Quad will advance development of clean hydrogen and clean ammonia fuels and launch a series of round tables on mitigating methane emissions across liquefied natural gas (LNG) sectors. It will also cooperate to enhance capacity in the broader Indo-Pacific region to participate in high-integrity carbon markets.