Green Hydrogen: Mapping the Path to Cost Parity in Hard-to-Abate Sectors
By Sudarshan Karweer
Green hydrogen's economics hinge on three variables: the delivered cost of renewable electricity, electrolyser CAPEX and utilisation. Each is moving in the right direction, but the binding constraint is offtake certainty.
Hard-to-abate sectors — refining, ammonia/fertiliser and steel — offer the anchor demand that makes gigawatt-scale electrolysis financeable. The India Green Hydrogen Mission's production incentives narrow the gap, but the decisive lever is long-tenor offtake structured around firm, round-the-clock renewable supply.
Our view: the first bankable projects will be co-located with captive RE and storage, underwritten by creditworthy industrial offtakers, and structured with blended finance to de-risk the early cost curve.
