India: Government issues Guidelines for Pilot Projects for utilizing Green Hydrogen in Shipping Sector

The Government of India has come out with guidelines for undertaking pilot projects for using green hydrogen in the shipping sector. The guidelines, named “Scheme Guidelines for implementation of Pilot projects for use of Green Hydrogen in the Shipping Sector”, have been issued by the Ministry of New & Renewable Energy (MNRE) on 1st February, 2024, under the National Green Hydrogen Mission.

Under the Mission, along with other initiatives, the Ministry of New & Renewable Energy will implement pilot projects in the shipping sector, for replacing fossil fuels and fossil fuel-based feedstock with Green Hydrogen and its derivatives. These pilot projects will be implemented through the Ministry of Ports, Shipping and Waterways (MoPSW) and the implementing agencies nominated under this Scheme.

Two areas have been identified as thrust areas under the pilot projects. These are retrofitting of existing ships so as to enable them to run on Green Hydrogen or its derivatives; and development of bunkering and refuelling facilities in ports on international shipping lanes for fuels based on Green Hydrogen.

The Scheme will be implemented with a total budgetary outlay of Rs. 115 crores till the financial year 2025-26.

Salient features of the Scheme are given below:

Projects with an intention to develop Pilot Scale/ Demonstration Plants for replication of technology will be supported
Shipping Corporation of India (SCI) or its successor, in case of disinvestment, will be the Scheme Implementing Agency (SIA) for retrofitting of the existing ships under Component-A. MoPSW shall finalize the SIA for Component-B of the Scheme.

The SIAs shall award the projects under the scheme through a transparent process. Provisions of General Financial Rules (GFRs) shall be followed in all selections/ procurement.
MNRE will issue administrative sanctions for the projects under the Scheme based on the recommendations of Project Appraisal Committee (PAC).

The Executing agencies (EAs) selected for the projects will share knowledge and the outcome of the pilot projects through project completion report, monitoring reports, workshops, and publications to disseminate findings, best practices, and lessons learned from the pilot.

The Scheme aims to leverage existing resources and infrastructure available with MoPSW and its agencies for transport, storage and use of Green Hydrogen and its derivatives in the shipping sector.

The Scheme would fund capital expenditure on retrofitting of existing ships with Green Hydrogen and its derivatives-based propulsion system and creating bunkering and refueling facilities on port(s). Expenses on account of production of Green Hydrogen or its derivatives, land, etc. will not be funded.

Financial support for projects will be evaluated and granted taking into consideration the specific needs, merits, and feasibility of each project.

The use of Green Hydrogen and its derivatives in the shipping sector, through the proposed pilot projects, will lead to the development of necessary infrastructure including refuelling stations, storage, and distribution networks, resulting in the establishment of a Green Hydrogen ecosystem in the shipping sector. The utilization of green hydrogen in the shipping industry is expected to increase over the years, with the expected reduction in its production cost.

The Scheme Guidelines may be accessed here.

The National Green Hydrogen Mission was launched on 4th January 2023, with an outlay of Rs. 19,744 crores up to FY 2029-30. It will contribute to India’s goal to become Aatma Nirbhar (self-reliant) through clean energy and serve as an inspiration for the global Clean Energy Transition. The Mission will lead to significant decarbonization of the economy, reduced dependence on fossil fuel imports, and enable India to assume technology and market leadership in Green Hydrogen.
Source: Government of India

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