With global leaders convening in Baku for COP29, discussions on climate finance and strategies to fund green projects in developing and least-developed nations have taken centre stage. Amidst these global negotiations, India is making strides of its own.
Last year, on a crisp morning in Faridabad, a hydrogen fuel cell bus quietly began its pilot run, emitting nothing but water vapour. This marked a significant step in India’s quest for cleaner energy in transportation—a sector long dominated by diesel and petrol vehicles that have contributed heavily to air pollution and greenhouse gas emissions. As India transitions towards greener alternatives, Liquefied Natural Gas (LNG) and hydrogen are emerging as vital players in shaping a sustainable future for its transportation ecosystem.
India, one of the world’s largest and fastest-growing economies, relies heavily on transportation to fuel its growth. However, this sector is also one of the largest contributors to air pollution, accounting for nearly 13% of the country’s total CO₂ emissions, according to the International Council on Clean Transportation. With the government’s ambitious goal of achieving net-zero emissions by 2070, the push for greener fuels like LNG and hydrogen is no longer just an environmental necessity but a strategic imperative.
The Promise Of LNG And Hydrogen
While electric vehicles dominate discussions on sustainable mobility, LNG and hydrogen provide complementary solutions, especially for medium and heavy-duty vehicles where electrification faces challenges such as limited battery range and payload constraints. LNG, for instance, is gaining traction due to its cleaner burning properties and high energy density. Unlike diesel, LNG produces significantly fewer greenhouse gas emissions and particulate matter, making it a cost-effective option for long-haul trucking. Companies like Petronet LNG Limited have demonstrated the viability of LNG-powered trucks along key transport corridors, achieving both lower emissions and substantial cost savings.
Hydrogen, on the other hand, offers an unparalleled opportunity for zero-emission transport. When used in fuel cells, it emits only water vapour, making it one of the cleanest fuels available. Though adoption in India is still nascent, initiatives like Indian Oil Corporation’s hydrogen bus pilot highlight its immense potential. However, scaling hydrogen infrastructure remains a formidable challenge, requiring substantial investment in production, storage, and refuelling facilities. Despite these hurdles, hydrogen holds promise for transforming long-haul trucking and heavy-duty transport in the years to come.
What The State Needs To Do
India’s green energy transition is underpinned by robust government initiatives aimed at fostering innovation and adoption. The National Hydrogen Mission, launched in 2021, aspires to position India as a global hub for green hydrogen production and export. With significant funding allocated for research, development, and infrastructure deployment, the mission is a cornerstone of India’s sustainability goals.
Similarly, the expansion of LNG fuelling stations along highways is gaining momentum, with government and oil companies collaborating to create a reliable supply network. Programs like the Faster Adoption and Manufacturing of Hybrid and Electric Vehicles (FAME) also extend support to hydrogen fuel cell technology, offering incentives to companies willing to invest in this frontier. At the state level, Maharashtra and Gujarat are leading the charge with localised green energy policies, providing subsidies and tax benefits to encourage the adoption of cleaner fuels.
Cost Questions
The cost of transitioning to LNG and hydrogen is a crucial factor for fleet operators. LNG offers immediate savings, with operational costs around ₹50-55 per kg compared to diesel’s ₹85-90 per litre. This price differential is particularly appealing for long-haul operators aiming to reduce expenses. Additionally, LNG engines require less maintenance, further enhancing their cost-effectiveness.
Hydrogen, while currently more expensive at ₹300-400 per kg, has a higher energy density than traditional fuels. The government’s efforts to lower hydrogen production costs to ₹150-200 per kg within the next decade could make it a viable option in the long term. However, the upfront costs of retrofitting vehicles for LNG or hydrogen remain a significant barrier, particularly for small and medium-sized operators.
Beyond costs, infrastructure gaps pose a major challenge. While LNG infrastructure is steadily expanding, hydrogen refuelling stations are virtually non-existent in India. Building this infrastructure requires billions in investment, coupled with widespread training programmes for mechanics and technicians to ensure safe handling and maintenance of LNG and hydrogen vehicles. Furthermore, inconsistencies in state-level policies create hurdles for companies trying to scale these solutions across the country.
Lessons From Leaders
Indian Oil Corporation has emerged as a leader in promoting alternative fuels. Its collaboration with Tata Motors on a hydrogen fuel cell bus pilot in Haryana demonstrated the potential of zero-emission public transport, reducing emissions by 90% compared to diesel buses. Similarly, Petronet LNG Limited is working to establish LNG fuelling infrastructure along key transport corridors, enabling fleet operators to adopt cleaner alternatives without compromising performance.
Mahindra & Mahindra, a prominent player in the Indian automobile industry, is exploring hydrogen fuel cells for heavy-duty trucks. The company’s research suggests that hydrogen-powered vehicles could reduce emissions by 85% and fuel costs by over 40% in the long run. These initiatives showcase how Indian companies are aligning with global trends while addressing local challenges.
Embracing Innovation
India’s shift to green energy presents significant opportunities for start-ups and investors to drive innovation. Companies specialising in cost-effective hydrogen production technologies, such as electrolysis using renewable energy, stand to benefit from this transition. Similarly, the development of affordable LNG and hydrogen conversion kits could lower entry barriers for fleet operators, accelerating adoption.
The creation of green fuel stations in urban and industrial hubs offers another avenue for growth. By establishing a reliable network of LNG and hydrogen refuelling stations, start-ups can play a pivotal role in supporting India’s green energy transition.
A Cleaner Road Ahead
India’s transportation sector is at a turning point. The move toward greener fuels like LNG and hydrogen is not just an environmental necessity but an economic opportunity that can position India as a leader in sustainable logistics. While challenges remain, the combined efforts of the government, industry leaders, and start-ups hold the promise of a cleaner, greener future.
As the engines of hydrogen buses hum and LNG-powered trucks traverse the country’s highways, India’s journey toward sustainable transportation continues to gain momentum. The road ahead may be long, but with innovative solutions and unwavering commitment, it promises to be one paved with progress and sustainability.
(Aashna Goel is the Director of Strategy at Goel Roadways and spent three years in Chicago’s M&A industry)
Disclaimer: These are the personal opinions of the author