Andhra Notifies Green Hydrogen Policy, Targets 0.5 MTPA Production By 2028

The development comes around five months after the Union government came out with its National Hydrogen Mission. The Union Budget of 2023 also announced sops for deploying green hydrogen in a phased manner. 

The policy envisaged the production of 0.5 MTPA of Green Hydrogen in the next five years and 2 MTPA of Green Ammonia during the same period. The policy document said that Andhra had a total hydrogen demand of 0.34 MTPA, primarily used in nitrogen fertilizers, besides the additional 0.13 MTPA demand in the refinery sector. The new policy will be applicable for the next five years.

As per the new policy, all the developers who want to produce Green Hydrogen/Green Ammonia by way of electrolysis of water using renewable energy in the state. It also allowed the production of green hydrogen and green ammonia produced from biomass. 

As per the policy document, the state would promote the production with open access routes from co-located or differently located RE plants, captive routes, third-party sales, and even power exchanges. It also talked about producing clean energy from Andhra discoms with applicable green power charges. 

Incentives 

In terms of government hand-holding support, the policy said that it would allow reimbursing 100 percent of the net SGST revenue to the developer from the sale of green hydrogen and green ammonia within the state for the next five years. It also talked about giving an exemption from electricity duty, the exception of ISTS charges for wheeling of the clean power, and reimbursement of cross-subsidy charges. It also said that the grid connectivity to the ISTS network at the generation end and production end for RE plants established for the production of green hydrogen and green ammonia would be granted on priority. 

The policy said that the developers would also be liable for a 100 percent exemption from payment of land use conversion charges and a 100 percent exemption from payment of stamp duty. It also discussed the charge of Rs 1 lakh per KTPA of green Hydrogen/green Ammonia production capacity as one-time facilitation charges to the nodal agency. The policy has made the New and Renewable Energy Development Corporation of A.P. Ltd (NREDCAP) the nodal agency.