The Ministry of New and Renewable Energy (MNRE) has sanctioned revised guidelines for the implementation of pilot projects focused on the production and use of green hydrogen through innovative methods. These projects are intended for decentralized and non-conventional applications in residential, commercial, and local community sectors. The scheme has a budgetary outlay of ₹200 crore until FY 2025-26 and supersedes a previous scheme document from November 8, 2024.
The initiative, implemented as part of the National Green Hydrogen Mission, aims to evaluate different production pathways and assess the feasibility of green hydrogen for a variety of applications.
Objectives and Scope
The primary objectives of the scheme are to:
- Support Innovative Production: Fund innovative models for producing green hydrogen, including those based on floating solar, biomass, and wastewater.
- Facilitate Decentralized Use: Support the use of green hydrogen and its derivatives for decentralized applications like cooking, heating, off-grid electricity generation, and off-road vehicles on a pilot basis.
- Validate Feasibility: Validate the technical feasibility and performance of green hydrogen as a fuel for household and commercial appliances, including city gas applications.
- Demonstrate Safety: Demonstrate the safe and secure use of green hydrogen and its derivatives in new sectors not covered by previous mission schemes.
The guidelines emphasize the use of decentralized renewable energy sources like rooftop solar and micro hydel plants to reduce the need for hydrogen transportation.
Implementation and Funding Structure
The scheme will be implemented in two parts by designated Scheme Implementing Agencies (SIAs):
- Part A: Will support biomass-based and other technology-based pilot projects with a total financial support of ₹100 crore. The maximum support for each project is ₹25 crore.
- Part B: Will support pilot projects from startups developing innovative hydrogen production/utilization technologies, also with a total financial support of ₹100 crore. The maximum support for each project is ₹5 crore.
The Central Financial Assistance (CFA) will be disbursed in three stages: 20% upon the issuance of a Letter of Award, 70% based on milestones, and the remaining 10% upon project completion. Private entities are eligible for up to 80% of the total equipment cost, while government organizations can receive up to 100%.
Project proposals will be evaluated by a Screening Committee within the SIA and a Project Appraisal Committee (PAC). Final approval will be granted by the Advisory Group of the National Green Hydrogen Mission. Executing agencies (EAs) are responsible for implementing the projects and disseminating the findings, best practices, and lessons learned.
Monitoring and Oversight
A Steering Committee chaired by the Secretary of MNRE will provide overall monitoring and implementation of the scheme. The PAC will evaluate projects and recommend them for sanction of CFA on a quarterly basis. The EAs are solely responsible for obtaining all necessary technical, regulatory, and safety approvals.
The scheme aims to identify innovative models and bridge gaps in current technology readiness, regulations, and supply chains, providing valuable inputs for the future commercial deployment of green hydrogen in new sectors.