India records lowest-ever price for green hydrogen in tender

India has recorded the country’s lowest-ever bid for the supply of green hydrogen, according to Renewable Energy Minister Pralhad Joshi.

The bid of Rs 279 ($3.08) per kilogram was to supply 10,000 tons of green hydrogen a year to Numaligarh Refinery Ltd., majority owned by state-run Oil India Ltd., in the northeastern state of Assam. Nine bidders participated in the tender, Bhaskar Jyoti Phukan, Numaligarh’s managing director, said in a phone interview, declining to say who the winning bidder was.

Joshi described it as “historic milestone in India’s clean energy journey,” in a post on X. It would strengthen the country’s position among the world’s most cost-competitive producers, he said.

Green hydrogen has been widely touted as a solution for hard-to-abate heavy industries like steel and cement, but demand and usage remain low, leading many investors to back out of projects. In India, low renewable energy costs, along with government incentives, including financial aid for green hydrogen production and equipment manufacturing, have helped the nation achieve competitive rates.

India has also maintained a full waiver of transmission charges for electricity used to produce the fuel, helping producers save on costs.

To boost domestic demand, New Delhi is working with local refineries to create 200,000 tons of annual consumption of green hydrogen at their sites, Renewable Energy Secretary Santosh Kumar Sarangi said on the sidelines of the India Energy Week last month. Efforts are underway to begin exports of green ammonia as early as 2028, Sarangi said at the event, adding the country is in talks with potential buyers in Europe and Japan.