In January 2023, the Government of India approved the National Green Hydrogen Mission with an outlay of ₹19,744 crore. The target: produce 5 million metric tonnes of green hydrogen annually by 2030, develop 125 GW of dedicated renewable energy capacity, and build domestic electrolyzer manufacturing capability. On paper, this is one of the largest industrial policy commitments India has made in a generation. In practice, the economics remain deeply challenging.
The Cost Gap Is Still the Core Problem
Grey hydrogen (made from natural gas via steam methane reforming) costs approximately ₹150-200 per kg in India. Green hydrogen (made by electrolyzing water using renewable energy) currently costs ₹700-800 per kg. The government's target is to bring green hydrogen to ₹250 per kg by 2030. This would require both electrolyzer costs to fall from ~$1,000/kW to $300/kW (which global trends suggest is plausible by 2030) and renewable electricity to reach ₹2/kWh for 24x7 supply (significantly harder).
Who Benefits: The Picks and Shovels
The cleanest beneficiaries are electrolyzer manufacturers and engineering companies that win EPC contracts — not the end hydrogen producers. In India, L&T has a dedicated green hydrogen business unit and is bidding for early-mover electrolyzer projects. Thermax has signed MoUs for electrolyzer supply. Reliance Industries has committed ₹75,000 crore toward green energy including hydrogen.
- Mission outlay: ₹19,744 crore (SIGHT scheme)
- 2030 target: 5 MMTPA green hydrogen production
- Current cost: ₹700-800/kg vs grey at ₹150-200/kg
- Electrolyzer cost to fall from $1,000 to $300/kW by 2030
- Key listed plays: L&T, Thermax, NTPC Green Energy, Reliance
🔍 BBS Insight
Green hydrogen is a 2030+ business story being priced into 2026 stocks. The right way to play it is through companies that benefit regardless of whether green hydrogen achieves cost parity — primarily EPC contractors like L&T and Thermax who earn fees on project execution. Avoid companies whose valuations are wholly dependent on cost parity being achieved by a specific date. Read policy tender documents and electrolyzer order disclosures, not just management commentary.