Uncertain demand signals and high costs are holding back India’s green hydrogen goals and plans, the Institute for Energy Economics and Financial Analysis (IEEFA) said in a briefing note on Friday, days after a senior Indian official warned the country would miss its 2030 green hydrogen production target.
Most projects to produce green hydrogen – via electrolysis using renewable electricity – in India are struggling to reach financial closure as buyer hesitancy amid high costs, uncertainty about long-term demand, and inadequate infrastructure slow project development, the Ohio-based think tank IEEFA said in its note.
India’s National Green Hydrogen Mission (NHGM), launched in 2023 with a budget of $2.2 billion, aims to produce five million metric tonnes per annum (mmtpa) of green hydrogen by 2030.
As of August 2025, the country had 158 green hydrogen projects at various stages of development. But a massive 94% of the planned capacity is yet to move beyond the announcement stage, and just 0.1% is under construction. Only 2.8% of the planned capacity is operational, highlighting the slow pace of project commissioning, IEEFA said.
“Although the announced capacity is nearly 2.4 times the government’s target—reflecting strong investor interest in India’s green hydrogen story—there are concerns about how much of this capacity will materialise, given the challenges surrounding its adoption and uptake,” said Charith Konda, Energy Specialist at IEEFA and one of the authors of the note.
Earlier this week, Santosh Kumar Sarangi, secretary at the Ministry of New and Renewable Energy, said that India would likely miss its 2030 goal of producing 5 million tons of green hydrogen per year, amid global policy shifts.
Globally, the green hydrogen drive is losing momentum as start-ups face rising costs and uncertain demand while energy majors back out of multi-billion-dollar projects as they return to their core oil and gas business.
By Tsvetana Paraskova for Oilprice.com
Related Stories
