Driving towards green horizons, OMCs unite for hydrogen road map

Fuelling the future: Oil ministry PSUs aim for 1 mt of green hydrogen by 2030

4 min read Last Updated : Jun 20 2024 | 11:57 PM IST

In a bid to accelerate their energy transition plans and ensure the adoption of green hydrogen in a comprehensive manner, state-owned oil marketing companies (OMCs) are expected to soon submit a joint road map for the sector, officials said.

The Ministry of Petroleum and Natural Gas Ministry has asked for the detailed plan being submitted before the upcoming national budget, the officials said.

Public-sector undertakings (PSUs) under the ministry target to produce more than 1 million tonnes (mt) of green hydrogen by 2030. However, despite forging private sector partnerships, and issuing tenders, work on no green hydrogen production unit has taken off so far.

"There is a need to bring together different stakeholders and make a plan to raise funds and start capex in a cohesive manner. Given that the OMCs are among the largest companies in India aiming to step into the green hydrogen economy, it would be better if there is a unified approach," an official said.

Refineries in the country already utilise hydrogen for internal consumption, which has the potential to be converted into green hydrogen. The ministry plans to ensure uptake through city gas distribution (CGD) where it will be blended green hydrogen (GH2) with natural gas.

IOCL plans to mix the green hydrogen produced with grey hydrogen that is produced during naptha or natural gas for captive purposes in secondary processing units. It is also testing hydrogen-enriched natural gas, or HENG, to be carried in natural gas pipelines. In theory, the two can be mixed in any proportion, but typically, HENG in the range of 10 per cent to 20 percent hydrogen by volume represents the most-promising near-term option.

Slow rollout

A series of hurdles has plagued green hydrogen plans by OMCs. The largest, IOCL, plans to set up green hydrogen units at all of its refineries as part of a Rs. 2.4 Trillion green transition plan to achieve net zero carbon emission status by 2046.

Back in 2021, IOCL had released bids to set up green hydrogen units at its refineries in Panipat and Mathura refineries. With planned installed capacities of 2,000 million tonnes per annum (mtpa) and 5,000 mtpa, respectively, the units were planned to be set up on a build-own-operate basis. The period of operation was up to 24 years and the new units had a target deadline of 28 months.

After the plans didn't fructify, the company decided to refocus its efforts on the Panipat refinery, its largest in India with 15 mtpa capacity. In August, last year, global tenders were established to establish a green hydrogen generation plant with 10 KTA (thousands tonnes per annum) capacity, under a 30 month construction deadline. But the tender was cancelled by the company after it led to bidders approaching the Delhi High Court arguing a conflict of interest.

Prospective bidders had alleged a conflict of interest on IOCL's part in the last tender. This was owing to GH4India Pvt Ltd, IOCL's own joint venture with infrastructure and engineering major Larsen & Toubro (L&T) and renewable energy company ReNew also bidding for the tender. An industry body of green hydrogen producers, the Independent Green Hydrogen Producers Association had also moved the Delhi High Court in November, 2023.

Subsequently, IOCL reissued the tender in early April, and extended the date for final submission of bids after prospective bidders said they will need more time to meet the specifications of the tender.

In February, BPCL invited bids to set up a green hydrogen refuelling station at Kochi airport in Kerala.

Last year, the Ministry informed the Parliament that HPCL is setting up an electrolysis-based green hydrogen plant with a capacity of 370 mtpa) at its Visakhapatnam Refinery in Andhra Pradesh. While it was set to be opened by September.