L&T bets on green hydrogen, battery storage, T&D to drive utilities growth

L&T is scaling up its utilities business by focusing on green hydrogen, large battery storage projects and a booming transmission and distribution segment in India and overseas

Larsen & Toubro (L&T) views green hydrogen as the most critical segment as it gradually builds presence in that space.This comes even as large-scale battery storage and transmission and distribution (T&D) remain key growth drivers for its utilities business.

 

T Madhava Das, whole-time director and senior executive vice-president (utilities), L&T, said green hydrogen is the most critical segment for L&T.

 

“Under our energy portfolio, we have created a separate company called L&T Energy Green Tech Ltd. We are concentrating on projects, but we are doing it step by step. We’re not trying to spread ourselves thin. We have already taken up two to three projects that we’d like to execute and see where they go,” he told Business Standard.

 

On the other hand, the company is targeting 10–12 giga watts (Gw) of renewable engineering, procurement, and construction (EPC) orders annually, amid the “booming” T&D segment.

 

Renewables order inflows have risen from 7–8 Gw to a projected 12 Gw in FY26. The company’s renewable EPC portfolio stands at 38 Gw.

 

It is working on large-scale projects in Saudi Arabia and the UAE, and 16 Gw-hours (GWh) of battery system projects. In India, it is executing about 600 MWh of battery projects across different locations.

 

L&T is also a major player in high-voltage transmission, executing up to 765 kV and 800 kV high voltage direct current (HVDC) lines in India and projects up to 400 kV in West Asia. It typically runs 14–15 transmission and substation projects in India at any given time.

 

In the green hydrogen segment, L&T has set up an electrolyser manufacturing facility at Hazira (Gujarat) and has tied up with France-based McPhy to develop its own technology.

 

It has commissioned a 1 mega watt (Mw) electrolyser at Kandla (Gujarat) and is now looking to scale it up.

 

The company is also working with Indian Oil Corporation for a green hydrogen project and believes that indigenisation will help lower costs. 

 

“With electricity costs also coming down, we are betting on our own electrolyser so that we can start bringing hydrogen closer to competitive levels,” Das said.

 

Internationally, L&T is collaborating with ACWA on the Yanbu green hydrogen project in Saudi Arabia and is involved in another “very large” project at Neom (also in Saudi Arabia), where it has executed the entire power system, including solar, wind, battery storage and T&D.

 

Das said the government’s push under the National Green Hydrogen Mission is encouraging but cautioned that scaling up will take time. 

 

“We are aligned and serious about it. It’s not going to grow as renewables did; one has to be patient in this field,” he added.

 

The Ministry of New and Renewable Energy (MNRE) aims to build 5 million tonnes per annum of green hydrogen capacity by 2030. L&T is executing a limited number of projects to stabilise technology and performance before expanding further.

 

It will also explore strategic partnerships. “In the process, we bring in efficiencies into manufacturing, strengthen our marketing setup, and examine the value chain needed to become more efficient. Instead of spreading across many projects, we’re going step by step, and we will continue doing it,” Das said.

 

Beyond hydrogen, L&T is focusing on desalination, offshore wind platforms and digital energy solutions. Das said desalination could emerge as a major opportunity as water scarcity intensifies. The company is executing large projects in West Asia, has delivered projects in India, and is investing in research and development (R&D) to scale up business.

 

In offshore wind, L&T is focusing on platforms rather than turbines. 

 

“We’re growing our offshore platform capability; it’s an area of interest because it dovetails with our hydrocarbon expertise in creating offshore structures. We are ready to scale it up significantly, as it’s a growing business in the European market,” Das added.

 

L&T’s digital energy solutions business focuses on grid management, generation and substation automation, with the US as a key market.

 

Overall, the utilities portfolio derives about 75 per cent of its business from overseas markets, mainly West Asia and the Commonwealth of Independent States (CIS), a post-Soviet bloc, with the rest coming from India.

 

To support growth, L&T is deploying artificial intelligence (AI), LiDAR and virtual reality, while centralising design, procurement and skill development through centres of excellence and construction training institutes.

 

Over the next three to four years, L&T will focus on expanding in India, the Middle East, CIS, and selectively in Africa, while tracking new markets. “Interest is also rising in ASEAN countries as Middle Eastern investors explore renewable opportunities there,” Das said.

 

In India, Das expects power distribution reforms, smart metering and grid modernisation to trigger a fresh investment cycle. Greater renewable integration and EV adoption will increase demand for advanced distribution systems and SCADA-enabled networks, creating new opportunities for the utilities business.