Rajasthan Announces Slew of Incentives for Green Hydrogen Projects

The state government approved the draft of the Rajasthan Green Hydrogen Policy 2023

September 18, 2023


The Rajasthan government has approved the draft of the ‘Rajasthan Green Hydrogen Policy-2023’, which seeks to promote green hydrogen generation by prioritizing the utilization of abundant renewable energy resources in the state.

The policy has enumerated the following incentives for the green hydrogen sector:

  • 50% rebate on transmission and distribution charges for ten years for green hydrogen projects with a capacity of 500 kilotons per annum
  • Exemption from additional and cross-subsidy surcharges for ten years if green hydrogen is procured from third parties
  • Priority in land allocation for green hydrogen production
  • 30% subsidy up to ₹50 million (~$601,520) for establishing green hydrogen research centers
  • Freedom to bank-generated electricity
  • No capacity restrictions on captive power projects
  • 100% waiver on wheeling and transmission charges
  • Reimbursement/waiver of banking charges for 7-10 years

The green hydrogen sector will also be included in the ‘Thrust Sector’ under the Rajasthan Investment Promotion Program 2022. It will be eligible to receive benefits from the manufacturing standard package as part of the sunrise sector.

The policy has incorporated suggestions sought by the state Energy Department from stakeholders.

Rajasthan is targeting the deployment of 90 GW of clean energy by 2030The state is investing ₹400 billion ($4.8 billion) to produce 5 GW of green hydrogen using solar power and advanced electrolysis techniques.

Last October, the Rajasthan government signed an agreement with Jakson Green to develop a phased green hydrogen and green ammonia plant valued at $2.8 billion. The project is expected to be completed in 2028.

In July, the Ministry of New and Renewable Energy unveiled a draft roadmap outlining the research and development (R&D) priorities to promote efficient, safe, and cost-effective hydrogen storage, paving the way for its widespread adoption as a clean energy source.