Hydrogen key to India's transition from fossil fuel importer to clean energy exporter: G20 Sherpa Kant

The urgency for India to transform from an importer of fossil fuels to an exporter of clean energy, in light of its massive fossil fuel dependence, is quite evident. “India is an importer of $180 billion worth of fossil fuel,” says Amitabh Kant, G20 sherpa at a recent round table while outlining the need for a clear national agenda to reverse this reliance by aggressively adopting renewable energy and clean energy technologies. 

He stresses that India must aim to not only meet but surpass its renewable energy targets. “We need to cross 500 gigawatts of renewable energy by 2030,” he says, acknowledging that while the country has made significant strides, there is still a long way to go. He points to a target of 750 gigawatts by 2030 as the next critical step.

Central to this shift is green hydrogen, which experts see as a game-changer in India’s energy landscape. “We should be able to crack renewable to produce green hydrogen and become the largest producer of green hydrogen, the cheapest exporter of green hydrogen in its liquid form, ammonia, to the rest of the world,” says Kant. India, blessed with abundant renewable energy resources, has the potential to become the world's leader in green hydrogen production and electrolyser manufacturing.

However, achieving these goals requires a robust action plan and a clear push towards decarbonising hard-to-abate sectors like steel, cement, and fertilizer. Kant calls for “a clear action plan for hard-to-abate sectors” and acknowledges the importance of driving renewable energy into industries beyond electricity, which only accounts for 25% of energy consumption.

One major challenge, however, lies in securing the necessary financing for this transition. “You do not have the depth of internal markets to raise financial resources,” he says while advocating for stronger international financial support. There arises a need for innovative financing mechanisms, including tripartite agreements between the central government, states, and the Reserve Bank of India.

“There is no shortage of funds in the world,” he shares, citing the $300 trillion available globally, with $150 trillion held by sovereign wealth and pension funds. But for these funds to flow into India, Kant stresses the need for enhanced mechanisms like escrow accounts and guarantees to attract private investment.

Beyond financing, technological advancement is also crucial. Kant points out that India's grid must be digitised, and the country needs to implement a “smart grid” system that can effectively manage and track renewable energy. Additionally, while India has ordered 222 million smart meters, only 15 million are operational, a gap that must be closed quickly to achieve energy efficiency.

As the global energy landscape shifts, it is imperative that India stay focused on its long-term vision. “Our vision and our ability to become an exporter of clean energy by 2030, rather than an importer of fossil fuels, must be absolutely crystal clear," he concludes, urging the country to take decisive action in aligning its financing, technology, and entrepreneurial efforts toward that goal.