Green hydrogen is hydrogen produced by splitting water into hydrogen and oxygen using electricity from renewable sources such as solar and wind. Because no fossil fuel is burned in the process, making it releases almost no carbon dioxide. Burning or reacting that hydrogen later gives back mostly water.

That property makes green hydrogen unusual among clean energy options. It is both a fuel and a chemical raw material, which allows it to reach into industries that batteries and direct electrification struggle to serve. Steel plants, fertiliser factories, refineries and ocean-going ships are the clearest examples.

The scale of the challenge is large. Global hydrogen demand reached almost 100 million tonnes in 2024, according to the International Energy Agency (IEA), yet low-emissions hydrogen made up less than 1% of that supply. Nearly all of the rest is still produced from natural gas or coal.

This article explains what green hydrogen is, why certain industries depend on it, where it works best, what stands in the way, and how India is approaching the problem.

What Is Green Hydrogen?

Hydrogen is the lightest and most abundant element, but it rarely exists on its own on Earth. It is locked up in water, natural gas and other compounds, so it has to be separated before it can be used. How that separation is powered decides whether the hydrogen is called grey, blue or green.

Green hydrogen uses electrolysis. An electrolyser passes electric current through water, which splits it according to the reaction below.

2H₂O → 2H₂ + O₂

If the electricity comes from solar, wind or hydropower, the hydrogen carries a very low carbon footprint. If the electricity comes from a coal-heavy grid, the label no longer applies, which is why the source of power matters as much as the electrolyser itself.

How an electrolyser works in plain terms

Think of an electrolyser as a stack of cells, each with two electrodes separated by a membrane or an electrolyte. Water goes in, electricity is applied, and hydrogen collects at one electrode while oxygen collects at the other. The main commercial technologies are alkaline electrolysers, proton exchange membrane (PEM) electrolysers and, at an earlier stage of deployment, solid oxide systems.

Energy use is the number that matters most to engineers. Hydrogen holds about 33.3 kWh of usable energy per kilogram (lower heating value), and real electrolysers convert electricity at somewhere around 60 to 70% efficiency. In practice that means roughly 50 to 55 kWh of electricity for every kilogram of hydrogen, plus about 9 litres of water at the very minimum.

Green, grey and blue hydrogen compared

The colour labels are shorthand for the production route. They are not an official standard, and regulators increasingly prefer to talk about measured carbon intensity instead.

Why Some Industries Are So Hard to Decarbonise

Power generation can be cleaned up by adding solar, wind and storage. Cars can switch to batteries. Heavy industry is harder because its emissions come from three sources at once, and electricity helps with only some of them.

Process emissions

In steelmaking, coal does not just provide heat. It also acts as the chemical agent that strips oxygen from iron ore. In cement, limestone releases carbon dioxide when it is heated, regardless of what fuel does the heating. Changing the energy source cannot remove these emissions, so the process itself has to change.

Very high temperatures

Many industrial furnaces run at temperatures that are difficult to reach with conventional electric heating at scale. Glass, cement kilns and some chemical processes need intense, continuous heat. Hydrogen can burn at high temperatures, which makes it a candidate fuel here, although heating with hydrogen needs equipment changes and careful safety design.

Chemical feedstock

Ammonia, methanol and many refinery processes consume hydrogen as an ingredient. Replacing that hydrogen with a low-carbon version is a more direct fix than any other approach. This is why the IEA notes that today's hydrogen demand sits almost entirely in refining, ammonia, methanol and fossil-based direct reduced iron.

The steel sector illustrates the stakes. Industry and research estimates put iron and steel at roughly 7% of global CO₂ emissions, and the conventional blast furnace route emits close to 2 tonnes of CO₂ for every tonne of steel produced. A sector of that size cannot be left out of any serious climate plan.

Where Green Hydrogen Fits, Sector by Sector

Not every industry has the same relationship with hydrogen. Some already use it in huge quantities and only need a cleaner source. Others would need to rebuild their processes around it.

Steel

The most promising route replaces coal with hydrogen in a process called direct reduced iron, usually shortened to DRI. Hydrogen reacts with iron ore to produce iron and water vapour instead of carbon dioxide. The iron is then melted in an electric arc furnace, ideally powered by clean electricity.

Hydrogen can also be injected into existing blast furnaces to cut coal use. A 2025 study by CSTEP, an Indian research organisation, estimated that about 18 to 25 kg of hydrogen could be used per tonne of steel in blast furnace injection. That reduces emissions partly, but full decarbonisation needs the DRI route.

The main barrier is the green steel premium. Industry analysis suggests a gap of roughly 150 to 300 dollars per tonne over conventional steel, which narrows as hydrogen gets cheaper and as buyers such as carmakers commit to paying for low-carbon material.

Ammonia and fertilisers

Ammonia is made by combining hydrogen with nitrogen, and the hydrogen currently comes mostly from natural gas. Swapping in green hydrogen produces green ammonia with the same chemical properties, so existing fertiliser plants can use it with limited changes. Few other sectors offer such a clean substitution.

Ammonia is also easier to transport than hydrogen gas, which has made it a leading candidate for moving renewable energy across oceans.

Refining and chemicals

Refineries use hydrogen to remove sulphur and upgrade fuels. They are among the biggest hydrogen consumers today, and the IEA identifies refining and chemicals as the leaders in adopting low-emissions hydrogen. Because the hydrogen is already part of the process, switching the source is a procurement and supply decision more than an engineering overhaul.

Cement and glass

Hydrogen has a smaller role here. In cement, it can supply some of the kiln heat, with studies suggesting 12 to 18 kg of hydrogen per tonne of clinker could be used as fuel depending on the design. But the limestone chemistry still releases carbon dioxide, so cement will probably also need carbon capture or alternative materials.

Shipping and aviation

Long-distance ships and aircraft need fuels with high energy density. Green hydrogen can be converted into ammonia, methanol or synthetic kerosene, which are easier to store and handle than hydrogen itself. The IEA reports that the fleet of vessels able to use hydrogen-based fuels is growing, though concerns about fuel supply and port bunkering infrastructure are slowing the pace.

A Worked Example: Hydrogen for a One Million Tonne Steel Plant

Numbers make the scale clearer. Take an illustrative plant that produces 1 million tonnes of steel per year using hydrogen-based DRI. The inputs below are round figures for teaching purposes and will vary by design.

Assumptions: hydrogen use of 50 kg per tonne of steel, electrolyser efficiency of 65% on a lower heating value of 33.3 kWh/kg, and a renewable plant capacity factor of 30%.

Step 1: Annual hydrogen demand. Hydrogen = 1,000,000 t steel × 50 kg/t = 50,000,000 kg, which is 50,000 tonnes of hydrogen per year.

Step 2: Electricity needed per kilogram. Energy per kg = 33.3 kWh ÷ 0.65 ≈ 51 kWh/kg.

Step 3: Annual electricity. Electricity = 50,000,000 kg × 51 kWh/kg = 2,550,000,000 kWh, or about 2.55 TWh.

Step 4: Average power and installed capacity. Average electrical load = 2,550,000,000 kWh ÷ 8,760 h ≈ 291,000 kW, or about 291 MW. Because solar and wind do not run all day at full output, the renewable capacity needed is higher: 2,550,000,000 kWh ÷ (0.30 × 8,760 h) ≈ 970,000 kW, close to 1 GW.

One steel plant of this size would therefore need nearly a gigawatt of renewable capacity dedicated to it, before counting the electricity for the arc furnace. That single calculation explains why green hydrogen planning is as much about renewable energy build-out as it is about electrolysers.

The Real Obstacles

Green hydrogen is promising, but it is not yet an easy choice. Treating it honestly means looking at what could slow it down.

Cost is the first problem. The IEA's 2025 review finds that low-emissions hydrogen remains more expensive than unabated fossil-based production, and that electrolyser cost projections have become less optimistic because deployment has been slower than expected. The agency still expects the gap to narrow toward 2030, with China reaching cost competitiveness first.

Demand certainty is the second. The IEA found that signed hydrogen offtake deals covered 1.7 million tonnes per year in 2024, down from 2.4 million in 2023, and only about 20% were firm agreements. Producers hesitate to build without buyers, and buyers hesitate to commit without guaranteed supply.

Infrastructure and storage are the third. Hydrogen is a small, light molecule that needs compression, liquefaction or conversion into carriers such as ammonia. Pipelines, ports and storage sites for it are still limited.

Expectations have also been recalibrated. Announced low-emissions hydrogen projects could reach 37 million tonnes per year by 2030, but that is lower than the earlier estimate of 49 million. Projects that are operating or already financed point to about 4.2 million tonnes per year by 2030, roughly 4% of global production.

There is a broader debate as well. Some analysts argue that labelling steel and cement as permanently hard to abate can delay action, and they stress that direct electrification and efficiency should come first wherever they work. Hydrogen is most justified where no practical alternative exists.

Green Hydrogen in India

India has strong reasons to pursue green hydrogen. It has high solar potential, large fertiliser and steel sectors, and a heavy import bill for natural gas and other fossil fuels.

The Union Cabinet approved the National Green Hydrogen Mission on 4 January 2023 with an initial outlay of ₹19,744 crore. The mission targets green hydrogen production capacity of at least 5 million tonnes per year by 2030, along with about 125 GW of associated renewable energy capacity. Official projections include more than ₹8 lakh crore of investment, over 6 lakh jobs and roughly 50 million tonnes of annual emissions avoided.

The Strategic Interventions for Green Hydrogen Transition (SIGHT) programme carries most of the funding. It offers incentives for electrolyser manufacturing and green hydrogen production, and the Solar Energy Corporation of India (SECI) runs the auctions. Ports at Deendayal, Paradip and V.O. Chidambaranar has been recognised as a green hydrogen hub.

The clearest progress is in green ammonia. In SECI's first auction in August 2025, the winning bid for supply to a fertiliser plant in Odisha came in at ₹49.75 per kg, far below the 2024 European H2Global result of about ₹100 per kg. Contracts for 724,000 tonnes per year of green ammonia across 13 fertiliser units were later signed on 10-year terms, with prices ranging from ₹49.75 to ₹64.74 per kg, or roughly 570 to 740 dollars per tonne.

A reality check is useful. Reports in early 2026 indicated that actual commissioned green hydrogen capacity in India was still only around 8,000 tonnes per year, against 862,000 tonnes per year awarded under SIGHT incentives. Awarded capacity is a pledge. Commissioned capacity is what actually reduces emissions, and the gap between the two will be the number to watch over the next few years.

Skills and Careers

A hydrogen economy needs people who understand electrochemistry, power electronics, process safety, compression and storage, and fuel cell systems. The Mission's own jobs estimate of over 6 lakh positions by 2030 shows how much workforce planning is expected.

Hands-on practice with electrolysers is expensive and limited, so simulation-based learning has a role. Training tools such as Scientech's Nvis GHLS-01 Green Hydrogen Interactive Simulation Software cover electrolysis-based production, storage methods including compressed gas, liquid and solid-state, safety, distribution and fuel cell applications through animated diagrams and virtual experiments. Tools like this help students and trainers build conceptual understanding before they touch real equipment.

Conclusion

Green hydrogen earns its place in the climate conversation because of what it can do for industries with few other options. A steel plant cannot run on batteries, a fertiliser factory needs hydrogen as an ingredient, and a cargo ship needs a dense, storable fuel. In each case, green hydrogen or its derivatives offer a route to deep emission cuts that electricity alone cannot provide.

The caveats are real. The numbers in this article show a technology that still costs more than the fossil alternative, needs enormous renewable capacity, and depends on buyers willing to sign long contracts. Progress will be uneven, and the sectors with existing hydrogen demand, such as ammonia and refining, are likely to move first.

For India, the combination of cheap solar potential, a large industrial base and policy support gives green hydrogen a credible path. Readers studying engineering or working in energy should follow SECI auction results, commissioning data and steel sector pilots closely, because the next five years will show whether announced capacity turns into real plants. Anyone preparing for a career in this field can start now by learning electrolysis, storage and safety fundamentals.

FAQ

Q: What is green hydrogen in simple words? 

Green hydrogen is hydrogen made by splitting water into hydrogen and oxygen using electricity from renewable sources such as solar or wind. Since no fossil fuel is burned to make it, the process produces almost no carbon dioxide. It can then be used as a fuel or as an industrial raw material.

Q: How is green hydrogen different from grey and blue hydrogen? 

Grey hydrogen comes from natural gas and releases its carbon dioxide into the air. Blue hydrogen also comes from natural gas but captures and stores part of the carbon dioxide. Green hydrogen uses water and renewable electricity, so it avoids fossil fuels entirely, which is why it is the preferred option for deep decarbonisation.

Q: Which industries need green hydrogen the most? 

Steel, ammonia and fertilisers, refining, methanol and other chemicals, and long-distance shipping are the main candidates. These industries either use hydrogen already or cannot easily switch to electricity. Cement and glass may use hydrogen for heat, though it will not solve all of their emissions.

Q: Why is green hydrogen so expensive? 

Electrolysers are costly, and each kilogram needs around 50 to 55 kWh of electricity, so power price and utilisation matter enormously. Storage and transport add further cost. The IEA expects the gap with fossil-based hydrogen to narrow toward 2030, but it still sees low-emissions hydrogen as more expensive in the near term.

Q: Is green hydrogen safe to use in industry? 

Hydrogen is flammable and leaks easily because its molecules are so small, so facilities need good ventilation, leak detection and trained staff. Industry has handled hydrogen for decades in refineries and chemical plants under established safety standards. Safe handling is a learnable skill, and it forms a core part of hydrogen training.

Q: What is India's green hydrogen target for 2030? 

The National Green Hydrogen Mission aims for at least 5 million tonnes per year of green hydrogen production capacity by 2030, with about 125 GW of linked renewable capacity. Progress so far is strongest in green ammonia contracts, while commissioned production is still small compared with the target.