Green hydrogen will cost $3-7 a kg by 2030, says top Indian scientist

Vijay Kumar Saraswat is a highly respected name in India. The man of science has been the Director General of the government-owned Defence Research and Development Organisation (DRDO). Today, he is an influential member of the government's think-tank, Niti Aagoy. His views carry weight.

Now, in an interview to Business Line, Dr Saraswat has said that green hydrogen will cost $3-7 a kg, at the doorstep. 

Here is what Dr Saraswat said about green hydrogen:

The cumulative supply chain cost is: production at $5–6 per kg, compression ($2 per kg), and distribution ($3 per kg). In the long run, with large electrolyser making capacity coming up in the country, their cost will come down from $800-$1,500 per kWh. It is expected that by 2030, hydrogen production costs will be $1-3 per kg and compression costs will be $2-4. So the total cost at the door step will be about $3–7 per kg including production, compression, and distribution.

At present, green hydrogen is not economical. But grey hydrogen is competitive, but it’s not green. Grey hydrogen is available at less than $2 per kg. It releases CO2, but we can use CCUS to abate CO2. With CCUS, grey becomes blue and production costs are 30 per cent cheaper. With lower costs, industries such as steel, cement, aluminium, refineries, etc. can start using blue hydrogen. As demand for blue hydrogen grows, more production will happen, which will further reduce costs. In my opinion, blue hydrogen is an enabler to green hydrogen. Affordability is the key to ramping up production. For instance, when we ask fertiliser industries why they do not use grey hydrogen, they say that production costs will go up from $375 a tonne for grey to $875 for green. Nobody will do that at such high costs.

Saraswat has for long been a votary of methanol, which many in India believe to be a superior fuel than ethanol to blend with gasoline. In India, the government has mandated 20 per cent blending of ethanol with gasoline by 2025; today, the blend is slightly higher than 9 per cent. But methanol has a lot of takers.

Here is what Saraswat says about hydrogena and methanol:

Hydrogen has a low molecular weight and requires a lot of space. So one cannot carry a lot of quantity. So there are range limitations, but it can be used for short haul (up to 300 KM). With methanol on-board, we can use methanol reforming to produce hydrogen. Recently, we have developed a reformer at Thermax that is doing the job. Here with hydrogen, CO2 is also released. We absorb the CO2 with an absorber, so this hydrogen is green. We can put this hydrogen into fuel cells. This can be the answer to clean energy for long-haul vehicles up to 1,000 km. The only high cost here is fuel cells. But with the PLI (production-linked incentive, which gives the manufacturer a cash compensation for every unit of production) scheme for developing electrolysers and fuel cells, prices will come down. Methanol can be produced using coal.