Government Launches Pilot Projects Using Green Hydrogen in Trucks and Buses

The program will have an outlay of ₹4.96 billion until FY 2025-2026

February 15, 2024


After initiatives aimed at using green hydrogen to decarbonize the shipping and steel sectors, the government has turned its attention towards transportation. The Ministry of New and Renewable Energy (MNRE) has launched pilot projects to use green hydrogen in the long-haul transportation sector under the National Green Hydrogen Mission.

The program aims to support the deployment of green hydrogen through fuel cell electric vehicles (FCEVs) and hydrogen internal combustion engine (ICE) based trucks and buses in a phased manner. It will also explore blending green hydrogen-based ethanol, methanol, and other synthetic fuels to run automobiles.

The program eventually envisions setting up “Hydrogen Highways” for heavy-duty and long-haul vehicles, with certain routes to be equipped with distribution networks and refueling stations.

The program has an outlay of ₹4.96 billion (~$59.8 million) until the financial year 2025-26 and will be implemented through the Ministry of Road Transport and Highways (MoRTH) and nominated executing agencies.

Financial assistance in the initial years will be provided to FCEVs and hydrogen ICE vehicles to close the funding gap, considering their higher cost. The ministry expects the cost of hydrogen to come down with the falling costs of renewable energy and electrolyzers. Expenses to produce green hydrogen or land will not be funded.

Central financial assistance will be disbursed in three stages: Issue of letter of award (20%), milestone-based disbursement (70%), and completion (10%).

The pilot projects aim to validate the technical and economic viability of using green hydrogen in the transport industry, especially for the inter-city movement of goods and people. They will help assess operational issues, safety, infrastructure needs, and regulations required for scaling up deployment.

The executing agencies selected for the projects will then share quarterly reports of the pilot projects to disseminate findings, best practices, and lessons learned.

Recently, the government launched pilot projects to test the viability of using green hydrogen and its derivatives in the shipping and steel sectors.

Road transport contributes about 12% to India’s carbon emissions while exacerbating urban air pollution, according to the International Energy Agency. The agency estimates that emissions and energy consumption from road transport could double by 2050 owing to rising demands for private mobility and transportation of goods.

In January last year, the Union Cabinet approved the National Green Hydrogen Mission to facilitate demand creation, production, utilization, and export of green hydrogen with an initial outlay of ₹197.44 billion (~$2.3 billion).