The Potential Role of Hydrogen in India A pathway for scaling-up low carbon hydrogen across the economy WILL HALL, THOMAS SPENCER, G RENJITH, SHRUTI DAYAL THE ENERGY AND THE ENERGYR ANESOURCED S INSTITUTE RCreatingESOURCE InnovativeS INSTITUTE Solutions for a Sustainable Future Creating Innovative Solutions for a Sustainable Future ©2020 The Energy and Resources Institute Authors Will Hall, Fellow, TERI Thomas Spencer, Fellow, TERI G Renjith, Research Associate, TERI Shruti Dayal, Project Associate, TERI Reviewer Mr Girish Sethi, Senior Director, TERI Advisor Dr Ajay Mathur, Director General, TERI Disclaimer This report is an output of a research exercise undertaken by TERI and supported by CIFF. It does not represent the views of the supporting organizations or the acknowledged individuals. While every effort has been made to avoid any mistakes or omissions, TERI would not be in any way liable to any persons/organizations by reason for any mistake or omission in the publication. Suggested Citation: Hall, W., Spencer, T., Renjith, G., and Dayal, S. 2020. The Potential Role of Hydrogen in India: A pathway for scaling-up low carbon hydrogen across the economy. New Delhi: The Energy and Resources Institute (TERI). Published by The Energy and Resources Institute (TERI) Darbari Seth Block, IHC Complex, Lodhi Road, New Delhi - 110 003 THE POTENTIAL ROLE OF HYDROGEN IN INDIA A PATHWAY FOR SCALING-UP LOW CARBON HYDROGEN ACROSS THE ECONOMY WILL HALL, THOMAS SPENCER, G RENJITH, SHRUTI DAYAL THE ENERGY AND RESOURCES INSTITUTE Creating Innovative Solutions for a Sustainable Future | 2 | THE POTENTIAL ROLE OF HYDROGEN IN INDIA ENERGY TRANSITIONS COMMISSION INDIA Energy Transitions Commission (ETC) India is a research platform based in The Energy and Resources Institute (TERI) in Delhi. ETC India is the Indian chapter of the global Energy Transitions Commission, which is co- chaired by Lord Adair Turner and Dr Ajay Mathur. ETC India initiated activities in 2017-2018 with a focus on the decarbonization of India’s power sector. Whilst that work is still continuing, ETC India has also started to work on industry transition, particularly in the ‘harder-to-abate’ sectors including iron and steel, cement, and other industry sub-sectors. Work has also begun on cross- cutting themes, such as hydrogen, Carbon Capture, Use and Storage (CCUS), and biomass. Learn more at: https://www.teriin.org/energy-transitions THE POTENTIAL ROLE OF HYDROGEN IN INDIA | 3 | ACKNOWLEDGEMENTS This work would not have been possible without the financial support from the Children’s Investment Fund Foundation (CIFF). We would also like to acknowledge the support of ETC, which has already done so much to advance the conversation around decarbonizing the entire economy. The comments and advice from the ETC team feature heavily in this work. We would also like to thank the following organizations for providing their comments: International Energy Agency (IEA) International Advanced Research Centre for Powder Metallurgy and New Materials (ARCI) Ashok Leyland Sponge Iron Manufacturers Association (SIMA) Shell India Markets Private Limited (SIPL) World Resources Institute India (WRII) Rocky Mountain Institute (RMI) OXGATE (Oxford University) THE POTENTIAL ROLE OF HYDROGEN IN INDIA | 5 | FOREWORD The Energy and Resources Institute (TERI), under our Energy Transitions Commission India work programme, has been assessing technological and economic trends in various energy-producing and consuming sectors so as to advance our understanding of the role of key low carbon technologies in decarbonizing the Indian energy system. Over the past couple of years, this has included detailed modelling of the Indian power system, as well as technology pathways for the heavy industry sectors, such as iron and steel. From this analysis and TERI’s broader work on transport systems, the balance of evidence suggests that renewable electricity, electricity storage, and hydrogen, along with biomass-based electricity and fuels, are the most viable energy options for India in a zero-carbon emissions economy. It turns out that hydrogen has the potential to play a major role across a number of sectors. As a result, we felt it was important to conduct a holistic assessment of hydrogen production and use for the Indian context. Interest around the potential role of hydrogen in the transition to zero carbon energy systems is growing. Recent years have seen increasing international commitments, industry activity, and civil society interest. It is important that India remains ahead of the curve on clean energy technology development, investing early in research and manufacturing capability to maximize domestic benefits. This report provides a first-of-its-kind assessment for India on the sector-wise potential of hydrogen, helping policymakers and businesses plan better for a low carbon future. Based on our analysis, we conclude that green hydrogen (produced from renewable electricity) has huge potential in India’s energy transition. In transport, this can be used to fuel longer-range vehicles and heavier-duty trucks, in industry largely as a chemical feedstock, and in the power sector, to provide longer-term energy storage. As with other clean energy technologies, the falling cost of hydrogen will drive its uptake, with initial scale-up being driven by collaborations between progressive public and private players. And the possibility of the economic viability of hydrogen as a fuel or a feedstock in different applications at different prices provides an opportunity to grow this market, reduce hydrogen prices, and then grow the market again. India has an opportunity to grow an economically competitive low carbon hydrogen sector, reducing energy imports, whilst drastically reducing emissions. At TERI, we look forward to working with partners to accelerate this transition. Dr Ajay Mathur Director General, TERI THE POTENTIAL ROLE OF HYDROGEN IN INDIA | 7 | TABLE OF CONTENTS 1. Executive Summary ..............................................................................................................................13 2. Introduction ......................................................................................................................................... 23 3 Hydrogen Technologies ........................................................................................................................ 27 3.1 Production ....................................................................................................................................... 28 3.1.1 Electrolysis ............................................................................................................................ 29 3.1.2 Other considerations ..............................................................................................................35 3.1.3 Methane reformation ............................................................................................................ 36 3.1.4 Other considerations ............................................................................................................ 38 3.1.5 Coal gasification ................................................................................................................... 39 3.1.6 Other considerations ............................................................................................................. 40 3.1.7 Other potential technologies ................................................................................................. 40 3.1.8 Comparison ......................................................................................................................... 43 3.2 Transportation of Hydrogen ...............................................................................................................47 3.2.1 Pipelines ...............................................................................................................................47 3.2.2 Trucks .................................................................................................................................. 48 3.2.3 Shipping .............................................................................................................................. 48 3.3 Storage of Hydrogen ........................................................................................................................ 48 3.3.1 Geological storage ................................................................................................................ 49 3.3.2 Steel tanks ........................................................................................................................... 49 4. Transport ..........................................................................................................................................51 4.1 Introduction ......................................................................................................................................52 4.2 Understanding Conversion Efficiency of ICE, Electric, and Hydrogen Drivetrains ..................................52 4.3 Total Cost of Ownership Assessment ................................................................................................53 4.3.1 Introduction ...........................................................................................................................53 4.3.2 Heavy-duty transport: Buses and Trucks ................................................................................ 56 4.4 Other Transport