Ambani, Asia’s richest man who’s built his fortune on fossil fuels, announced plans earlier this month to invest $75 billion in renewables infrastructure including generation plants, solar panels and electrolyzes. There is growing speculation that the strategy entails transforming all that clean power into hydrogen, one of the largest endorsements in the next-generation fuel. Reliance is likely to opt for hydrogen in a bid to avoid India’s wholesale electricity market, which is dominated by financially stressed utilities and plagued by delayed payments. Green hydrogen made from water and clean electricity is seen as crucial for the world’s emissions reduction goals, helping consumers and key industries such as steel transition to lower-carbon fuels. Prime Minister Narendra Modi last year announced a plan to make India, the world’s third-biggest emitter of greenhouse gases and a major energy importer, into a global hub for production and export of fuel.
Reliance hasn’t broken out how much will be devoted to hydrogen, the $75 billion investment in clean energy is by far the biggest in the country. Other companies such as Adani Enterprises Ltd. and state-run energy firms NTPC Ltd. and Indian Oil Corp. also have set plans for green hydrogen. The number of countries with a hydrogen strategy doubled last year to 26, and expected plans from the U.S, Brazil, India, and China could reshape the global market. But the sector is still experimental and far from commercially viable. India is relying on the country’s billionaires, including Ambani and his rival Gautam Adani, to lead the way. The nation wants to offer free transmission of clean power from one province to another for making hydrogen and make land available for building renewable energy projects as well as facilities to store green hydrogen and green ammonia. Reliance has correctly identified areas where they can be cost competitive: green hydrogen and solar.