IOC, L&T, ReNew join hands for green hydrogen biz
NEW DELHI: India’s oil giant, Indian Oil Corporation Ltd (IOC), engineering and construction giant Larsen & Toubro, and renewable energy company ReNew Power on Monday came together to form a joint venture to develop green hydrogen business.
“The tripartite venture is a synergistic alliance that brings together the strong credentials of L&T in designing, executing, and delivering EPC projects, IOC’s established expertise in petroleum refining along with its presence across the energy spectrum, and the expertise of ReNew in offering and developing utility-scale renewable energy solutions,” the firms said.
IOC and L&T have also signed a pact to form a joint venture with equity participation to manufacture and sell electrolyzers, used in the production of green hydrogen.
The joint ventures will look to manufacture zero-carbon emitting hydrogen, used by refineries to steel plants and even to run automobiles, via electrolysis powered by renewable energy.
The government in February notified a policy to boost the production of green hydrogen and green ammonia to help India become a global hub for the environmentally friendly version of hydrogen. For countries such as India, with its everincreasing oil and gas import bill, this can also help provide crucial energy security by reducing overall dependence on imported fossil fuels.
The demand for hydrogen is estimated to be 12 million tonnes by 2030 and around 40% of the element produced in the country, around 5 million tonnes, will be green, according to the guidelines of the National Hydrogen Mission.
By 2050, nearly 80% of India’s hydrogen is projected to be produced by renewable electricity and electrolysis. Green hydrogen may become the most competitive route for hydrogen production by around 2030. This may be driven by cost declines in key production technologies and in clean energy technologies such as solar photo voltaic and wind turbines.
“Today, hydrogen is mainly used in the refining, steel, and fertilizer sectors, which will be the focus of the joint ventures’ initial efforts,” the companies said. “The country’s refining sector consumes 2 million tonnes of grey hydrogen every year, with IOC owning one of the largest shares of its refining output.” The green hydrogen policy provides for the waiver of interstate transmission charges for 25 years and a banking provision of up to 30 days, which will help reduce the cost of green hydrogen significantly.
“The IOC-L&T-ReNew JV will focus on developing green hydrogen projects in a timebound manner to supply green hydrogen at an industrial scale,” said S.N. Subrahmanyan, chief executive officer and managing director, L&T.