A crucial component of the energy revolution is green hydrogen. However, it is not the next step right away because we first need to speed up the deployment of renewable electricity to decarbonize current power systems, speed up the electrification of the energy sector to use affordable renewable electricity, and then use green hydrogen to decarbonize hard-to-electrify sectors like heavy industry, shipping, and aviation.
As they aim to shift to a more sustainable source of energy, some of the giant corporations and governments in the world have been interested in green hydrogen, an eco-friendly gas.
One of the best ways to attain net zero emissions is with green hydrogen, one of the cleanest energy sources on the planet.
In this blog, we have discussed the top green hydrogen stocks in India that are expanding quickly. So, read on to know more about the same!
India has said that it wants to be emissions-free by 2070. India's need for energy and resources is expected to increase as its economic narrative develops. In the previous 20 years, energy demand has doubled; by 2030, it is anticipated to increase by at least 25%.
Over 40% of India's primary energy needs, or over USD 90 billion annually, are imported. In addition, essential industries like transportation and manufacturing are heavily reliant on imported fossil fuels. This calls for a change in technology that enables an increased proportion of renewable sources in the energy mix and gradually lessens the reliance on fossil fuels.
The National Green Hydrogen Mission was established for this reason. The Center aspires for its investments to attract ₹8 trillion in capital and generate over 6 lakh employment by 2030. Furthermore, it is anticipated that by 2030 CO2 emissions will be reduced by around 50 MMT annually.
India has pledged to lower the emissions intensity of its GDP by 45% from 2005 levels by 2030 as part of its Nationally Determined Contribution (NDC) to achieve the goals of the Paris Agreement.
Let us review the top Green Hydrogen Stocks in India now that we have a better understanding of this industry.
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Below is a list of some of the factors to consider before investing in Green Hydrogen stocks
Green hydrogen, or hydrogen produced using renewable energy, is seen by many experts as a viable form of sustainable energy. However, the transition to a sustainable economy cannot be achieved just by the use of conventional sustainable energy sources like wind and solar.
To stop global warming, we urgently need to make this switch. That hole can be filled with hydrogen.
Green hydrogen is receiving significant investment. However, due in part to the fact that green hydrogen must be produced using other renewable energy sources, it is currently incredibly unprofitable. Therefore, at least for shares, investors will first have to rely on the influence of the climate they achieve. Only in the long run will the financial gains come. This is becoming accepted by investors.
The substantial investments being made in hydrogen, including those made by Bill Gates, as well as the technical possibilities for energy generation and storage, serve as evidence of its potential.
In addition, experts anticipate that the $1 trillion US infrastructure plan will increase R&D investment as well as tax and other incentives for hydrogen. As a consequence, by 2030, the price of producing green hydrogen (now $5 per kilogram) should be reduced to $1. Lower costs will encourage the usage of hydrogen fuel cells even more.
Share prices, or the price at which an investor may buy or sell a share, continually fluctuate on the stock market since their very nature does not offer a set source of income.
The profitability of the underlying firm ultimately determines the return on investment from shares, which is influenced by stock market sentiment. The price of a share represents all potential earnings and entitles the holder to a portion of the profits.
Profits from hydrogen technology are yet in the future. Since it is impossible to predict these future gains, shares are mostly a promise for the future.
Reliance Industries Limited plans to invest over $10 billion in India's creation of a comprehensive ecosystem for new energy and materials to reach its net zero emissions goal by 2035. The Dhirubhai Ambani Green energy Giga complex, which would be built on 5,000 acres of land near Jamnagar, is what the business aims to create. This will be the new green ecosystem avenue that Reliance Industries has established.
They have also teamed up with several environmentally friendly companies that will help them with this endeavor. These include REC Solar Holding, Lithium Werks, and Faradion, among many more.
By the end of 2023, GAIL intends to construct the most significant green hydrogen plant in India in the Guna district of Madhya Pradesh. They want to establish a PEM-based project that would enable the daily production of 4.3 tonnes (10 MW capacity) of green hydrogen, which will be mixed with natural gas and provided to industry.
The most significant energy production in the nation is this 10 MW output. In addition, for use by fertilizer production facilities, this fuel can be sold.
The government-owned energy-generating firm NTPC Limited has chosen to expand its business into certain environmentally friendly areas by creating green hydrogen.
A floating solar installation will produce hydrogen using a 240kW solid oxide electrolyzer.
In the battle to produce green hydrogen, Indian Oil Corporation (IOC) Limited is not far behind. They have decided to replace at least a tenth of their fossil fuel use with hydrogen fuel. They have chosen to build refineries at Panipat and Mathura.
They aim to generate 5 GW of renewable power by the year 2025.
L&T Limited has chosen to build an environmentally friendly hydrogen plant in Gujarat's Hazira district. There, they want to daily manufacture 45 kg of green hydrogen. The 500kW battery energy storage system and the 990kW DC capacity will provide the energy needed to run this manufacturing area. 15% hydrogen will be added to natural gas as part of the procedure.
By 2025 and 2030, respectively, they intend to achieve water and carbon neutrality.
The most well-known company in India's energy and electricity business is Adani New Industries Limited. To expand their supply of green hydrogen, they have decided to spend more than $50 billion over the next ten years.
They have partnered with French company TotalEnergies for this purpose. By 2030, this new enterprise plans to create 1MT of renewable hydrogen yearly.
JSW Energy, a JSW Steel Limited subsidiary, has teamed up with an Australian business to collaborate on the possible project. 10,000 crores of rupees are suspected to be spent, according to JSW Steel, in the field of renewable energy.
The firm has not provided many specifics, but we expect to see them grow in the green industry.
Jindal Stainless Limited has teamed up with Hygenco India Private Ltd. to establish green hydrogen production facilities in order to reach the green hydrogen capacity.
They aim to reduce annual carbon emissions by 2,700 MT. Thanks to this project, they will be the first stainless steel firm in India to employ green hydrogen.
In July of 2022, Oil and Natural Gas Corporation Limited and M/s Greenko ZeroC Private Limited (Greenko) signed a memorandum of understanding (MoU) to work together and explore environmentally friendly opportunities for producing green ammonia and other derivatives of green hydrogen.
This Memorandum of Understanding will be in effect for two years, during which time Greenko, an Indian provider of renewable energy, will support ONGC's green initiative. The National Hydrogen Mission, which seeks to establish India as a global hub for green hydrogen, is supported by this agreement.
BPCL plans to build a 5 MW electrolyzer in Ahmedabad and Aurangabad using a phased installation strategy in order to produce green hydrogen.
The company's current steel pipelines will combine this green hydrogen with natural gas. Commercial, industrial, and home uses for this gas are planned. The business solicited bidders for the project because we believe that the key bidders are businesses that manufacture water electrolyzers.
In summary, hydrogen is the most prevalent element in the universe. It is also the simplest, with only one proton and one electron, which explains why it is the most prevalent—long hailed as the fuel of the future, hydrogen.
And this future is nearer than it appears, with several nations joining the US and the EU in the commitment to reduce greenhouse gas emissions by 30% by 2030. As an emission-free fuel and a green energy source to decarbonize other industries, green hydrogen will play a significant role.
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Disclaimer: This blog is solely for educational purposes. The securities/investments quoted here are not recommendatory.
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Research Analyst - Himanshu Sinha