Indian Oil, L&T and ReNew Form Green Hydrogen Joint Venture

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State-owned fuel distributor Indian Oil Corporation Ltd, engineering conglomerate Larsen & Toubro (L&T) and renewable energy giant ReNew have proposed a joint venture to develop India’s nascent green hydrogen sector.

The three entities announced on Monday the signing of binding specifications for the formation of a JVC in this regard. The three-party venture will bring together L&T’s strong credentials in the design, execution and delivery of EPC projects, Indian Oil’s established expertise in petroleum refining as well as its presence across the energy spectrum, and ReNew’s expertise in the supply and development of large-scale renewable energy. energy solutions, according to an official press release.

Additionally, Indian Oil and L&T have signed a binding term sheet to form an equity joint venture to manufacture and sell electrolyzers used in the production of green hydrogen.

SN Subrahmanyan, CEO and MD, L&T, said, “India plans to move fast in its decarbonization efforts and green hydrogen production is key in this endeavor. The IndianOil-L&T-ReNew joint venture will focus on developing green hydrogen projects within a limited timeframe to deliver green hydrogen on an industrial scale. While L&T will bring its strong EPC credentials to the table, IOC being India’s premier petroleum refiner with extensive capabilities in chemical processes and refining has established deep R&D capabilities in many aspects of the oil value chain. green hydrogen, and ReNew Power has quickly established itself as a leading supplier of renewable energy and has earned a very solid reputation. We see this partnership as an important step in India’s quest for alternative energy.”

The planned joint ventures aim to enable India’s transition from a gray hydrogen economy to a greener economy that increasingly manufactures hydrogen through electrolysis fueled by renewable energy.

Shrikant Madhav Vaidya, Chairman of Indian Oil, said, “As India’s Energy, we are committed to propelling India towards carbon neutrality by harnessing the power of green hydrogen. IndianOil is forging this alliance to realize India’s green hydrogen aspirations. »

Sumant Sinha, Chief Executive Officer of ReNew Power, said, “In line with the government’s broader strategic climate goals for 2030 and 2070 set by Honorable Prime Minister Narendra Modi, ReNew looks forward to working with L&T and IndianOil to develop the green hydrogen sector in India. . ReNew, as a leader in smart energy solutions with advanced capabilities in renewable energy technologies, is well positioned to complement the capabilities of our partners. »

The central government in February notified the Green Hydrogen Policy aimed at boosting the production of green hydrogen and green ammonia to help the country become a global hub for the green version of the element.

For countries like India, whose oil and gas import bill continues to rise, green hydrogen can also help provide crucial energy security by reducing global dependence on fossil fuels. imported.

While almost all of the hydrogen produced in India today is grey, it is estimated that the demand for hydrogen will be 12 MMT by 2030 and about 40% of the element produced in the country (about 5 MMT ) will be green, according to the National Hydrogen Project Mission Guidelines.

By 2050, nearly 80% of India’s hydrogen is expected to be ‘green’, ie produced by renewable electricity and electrolysis. Green hydrogen could become the most competitive route for hydrogen production by around 2030. This could be due to potential lower costs in key generation technologies and in clean energy technologies such as solar PV and wind turbines.

Today, hydrogen is mainly used in the refining, steel and fertilizer sectors, which will be the focus of early JV efforts. The country’s refining sector consumes approx. 2 MMT of gray hydrogen every year, with IndianOil holding one of the largest shares of its refining output.

To help decarbonize Indian industry, the new Green Hydrogen Policy provides interstate transmission fee waiver for a period of 25 years and a bank provision of up to 30 days, which will help significantly reduce the cost of green hydrogen. This will therefore lead to the replacement of gray hydrogen by green. The Ministry of Energy also provided a one-stop authorization portal for all authorizations and priority open access to green hydrogen projects.

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