© By Sudarshan Varadhan NEW DELHI () – (This Feb 17 story corrects the first line to say five million tons per year, not cumulative) India plans to produce five million tons of green hydrogen per year by 2030, said the Department of Energy. Thursday, aiming to meet its climate goals and become a production and export hub for the fuel. Green hydrogen, produced using renewable energy, has some of the best environmental characteristics of cleaner fuels. The carbon-free fuel is made using renewable energy from wind or solar sources to split water into hydrogen and oxygen. India will set up separate production zones, waive costs for electricity transmission between states for 25 years and provide priority connectivity to electricity grids for producers of green hydrogen and ammonia to boost production, the Federal Ministry of Energy said. The production target of five million tons is half that of the European Union, which plans to produce 10 million tons of hydrogen from renewable energy by 2030. Although green hydrogen is not currently made on a commercial scale in India, the richest men in the country, Mukesh Ambani, and Gautam Adani have announced plans to produce it. India, with a population more than three times the size of the EU, has a much lower energy consumption per capita but has one of the fastest growth rates of energy demand in the world. Mayank Bansal, chief commercial officer of ReNew Power, said the incentives announced by India could help reduce the cost of hydrogen production. “Currently, the production of green hydrogen is a costly affair and in recognition of this, the government has rightly waived interstate transportation costs,” Bansal said in a statement. India’s Energy Minister RK Singh said on Wednesday that green hydrogen producers will also be allowed to transport unused electricity to the grid. The stimulus measures announced on Thursday are the first part of India’s national hydrogen policy. The government has not said when the rest will be released. India also plans to provide federal funding for the establishment of electrolysers as it seeks to mandate the use of green hydrogen for refineries and fertilizer plants. Disclaimer: Fusion Media would like to remind you that the data on this website is not necessarily real-time or accurate. All CFDs (Stocks, Indices, Futures) and Forex prices are not provided by exchanges but rather by market makers, and therefore prices may not be accurate and may differ from the actual market price meaning prices are indicative and not suitable for trading purposes . Therefore, Fusion Media does not bear any responsibility for any trading losses that you may incur as a result of using this data. Fusion Media or anyone associated with Fusion Media accepts no liability for any loss or damage resulting from reliance on any information, including data, quotes, charts and buy/sell signals on this website. Be fully informed about the risks and costs associated with trading the financial markets, it is one of the riskiest forms of investment possible.