Introduction
Green hydrogen has emerged with remarkable speed from the periphery of energy policy discussions to occupy a central position in India’s long-term decarbonisation strategy. The National Green Hydrogen Mission, approved by the Union Cabinet in January 2023 with a financial outlay of Rs. 19,744 crore under the SIGHT scheme, envisions India as both a major producer and a major exporter of green hydrogen, targeting an annual production capacity of five million metric tonnes by 2030. The ambition is considerable and the rationale compelling: India has abundant solar and wind resources capable of producing the renewable electricity needed for electrolysis, and a potential comparative advantage in low-cost green hydrogen production that could fuel both domestic decarbonisation and a new export industry.
Yet the legal infrastructure for green hydrogen remains in a formative and, in several respects, contradictory state. The definitional question of what counts as “green” hydrogen is unresolved in domestic law. The regulatory jurisdiction for green hydrogen production facilities spans multiple agencies with inconsistent mandates. Land acquisition for the large-scale facilities that green hydrogen ambitions require implicates some of the most contested provisions of Indian environmental and social law. And the export ambitions, particularly the partnership with the European Union under the India-EU Green Partnership, require India’s green hydrogen standards to be compatible with the EU’s own hydrogen taxonomy, which is considerably more prescriptive than anything India has yet adopted domestically. This article examines the legal architecture of India’s green hydrogen framework, identifies the regulatory gaps and conflicts, and analyses the land, environmental, and definitional challenges that will determine whether the Mission’s ambitions translate into reality.
Legal Framework
The National Green Hydrogen Mission operates primarily through executive action rather than dedicated legislation. The Mission was approved as a government programme, with SIGHT (Strategic Interventions for Green Hydrogen Transition) constituting its financial incentive structure. SIGHT comprises two distinct financial incentive mechanisms: an incentive for electrolyser manufacturing and an incentive for green hydrogen production. The Ministry of New and Renewable Energy (MNRE) is the nodal ministry, with the Solar Energy Corporation of India (SECI) serving as the implementing agency for many of the tenders under the Mission.
The definitional vacuum is the Mission’s most significant legal gap. Neither the Mission document, the SIGHT scheme guidelines, nor any subsequent notification by MNRE contains a comprehensive statutory definition of “green hydrogen.” The guidelines specify that green hydrogen for SIGHT incentive purposes must be produced through electrolysis powered by renewable energy, but do not specify requirements for the renewable energy source’s temporal correlation with electrolysis, the geographic proximity of the renewable energy supply, or the maximum lifecycle carbon intensity of the hydrogen produced. These definitional questions are not merely academic; they determine which projects qualify for SIGHT incentives and which Indian green hydrogen may be exported under international trade agreements as genuinely low-carbon.
The electricity regulatory framework for renewable energy used in green hydrogen production falls within the jurisdiction of the Central Electricity Regulatory Commission (CERC) and State Electricity Regulatory Commissions (SERCs). Green hydrogen producers who wish to procure renewable energy from the grid must navigate open access regulations that vary by state. Several state governments, seeking to protect distribution company revenues, have imposed barriers to industrial open access that disadvantage large green hydrogen producers seeking to source renewable electricity from competitive suppliers. CERC has attempted to harmonise open access regulations for green hydrogen, but state-level resistance remains significant.
The Bureau of Energy Efficiency, through its role in the Indian Carbon Market, may issue carbon credits for green hydrogen projects that displace grey hydrogen production in fertiliser plants, refineries, and other industrial applications. This creates an intersection between the green hydrogen regulatory framework and the carbon credit framework that remains only partially mapped in existing guidelines.
Judicial Developments
Judicial engagement with green hydrogen as a specific legal category is nascent. No court has yet directly adjudicated disputes about the definition of green hydrogen, the eligibility criteria for SIGHT incentives, or the land acquisition modalities for Mission projects. However, relevant judicial precedents from analogous renewable energy and infrastructure contexts provide important guidance.
The Supreme Court’s decisions on land acquisition for renewable energy projects, particularly solar parks, are directly applicable to green hydrogen facility siting. In several cases involving the acquisition of agricultural land for solar parks in Rajasthan and Gujarat, courts have emphasised that the Land Acquisition, Rehabilitation and Resettlement Act 2013 (LARR Act) must be complied with in full, including the Social Impact Assessment requirement, even for projects classified as public purpose infrastructure under the Act. Green hydrogen production facilities, particularly large-scale projects requiring thousands of acres for integrated renewable energy, electrolyser, storage, and logistics facilities, will need to satisfy these requirements.
The NGT has addressed the environmental clearance requirements for electrolysis plants. A 2023 NGT order clarified that electrolysis-based hydrogen production facilities above specified capacity thresholds require environmental clearance under the EIA Notification 2006, as they fall within the chemical industry category of the EIA schedule. This determination, while technically straightforward, has implications for the Mission’s project timelines, as environmental clearance processes typically take twelve to eighteen months for Category A projects.
The Rajasthan and Gujarat High Courts have been engaged in litigation over land acquisition for renewable energy parks, and the legal principles developed in those cases will apply to green hydrogen projects that co-locate renewable energy generation with electrolysis facilities. Key contested issues include the adequate compensation for farmers displaced from agricultural land, the adequacy of Social Impact Assessments in areas with significant tribal populations, and the validity of using emergency provisions under the LARR Act to bypass the Social Impact Assessment process.
Contemporary Issues and Analysis
The colour taxonomy of hydrogen, with green referring to electrolysis powered by renewables, blue to hydrogen produced from natural gas with carbon capture and storage, grey to unabated natural gas reforming, and pink to nuclear-powered electrolysis, has important legal implications for India’s Mission design. The Mission is explicitly focused on green hydrogen, but several industrial proponents have advocated for the inclusion of blue hydrogen as a lower-cost transitional pathway. Including blue hydrogen in India’s national hydrogen strategy would require acknowledging carbon capture and storage as a recognised technology in Indian environmental law, which remains underdeveloped.
The carbon capture and storage (CCS) gap is legally significant. India has no dedicated CCS law or regulatory framework. The storage of captured carbon dioxide in geological formations falls within the jurisdiction of the Petroleum and Natural Gas (Safety in Offshore Operations) Rules for offshore applications and is essentially unregulated onshore. Any expansion of India’s hydrogen strategy to include blue hydrogen would require developing this regulatory framework, a process that could take years.
The electrolysis technology choice has become a commercially and legally significant question. Alkaline electrolysers, proton exchange membrane (PEM) electrolysers, and solid oxide electrolysers have different cost profiles, efficiency characteristics, and technology readiness levels. India’s electrolyser manufacturing incentive under SIGHT has attracted significant interest from domestic manufacturers, but questions about minimum domestic content requirements and technology transfer obligations have created tension with foreign electrolyser suppliers who see the Indian market as strategically important.
The water requirement for green hydrogen production is an underappreciated environmental concern with significant legal dimensions. Large-scale electrolysis requires substantial quantities of purified water. In water-stressed regions of India, including parts of Rajasthan and Gujarat where solar resources are most abundant, the allocation of water rights to large industrial users requires careful regulatory design. Water allocations in these states involve multiple regulatory authorities including state water resources departments, river basin authorities, and groundwater regulation boards, creating coordination challenges that the Mission has not yet addressed.
Comparative and International Perspective
The European Union’s approach to defining green hydrogen for regulatory purposes is far more prescriptive than India’s. The EU’s Delegated Regulation on Renewable Fuels of Non-Biological Origin, adopted in February 2023 under the Renewable Energy Directive, establishes detailed criteria for what counts as renewable hydrogen for EU energy and climate accounting purposes. The criteria require that the renewable electricity used for electrolysis be sourced from newly built renewable installations (the additionality requirement), that it be produced in the same bidding zone as the electrolysis facility or in adjacent zones (the geographic correlation requirement), and that the production be temporally correlated with renewable electricity generation on an hourly basis by 2030 (the temporal correlation requirement).
These EU criteria are substantially more stringent than anything India has adopted domestically. If India wishes to export green hydrogen to the EU, or to have Indian green hydrogen count toward the EU’s renewable hydrogen import targets, Indian producers will need to meet EU definitional standards. This creates a potential two-tier market: Indian green hydrogen that meets EU standards for export, and a potentially larger domestic category of “green” hydrogen that meets only India’s more permissive domestic standards.
Germany’s H2Global Programme represents an innovative procurement mechanism for green hydrogen imports, operating through a double auction in which H2Global purchases hydrogen from producers through long-term contracts and sells it to European consumers. India has been identified as a priority supply country under H2Global, with MNRE and German implementing agencies having signed Letters of Intent. The programme’s contractual structure, which involves Indian producers entering long-term supply agreements with H2Global GmbH, a German company, raises Indian foreign exchange, contract enforcement, and regulatory jurisdiction questions that have not yet been resolved.
The comparison with Japan’s Basic Hydrogen Strategy, which encompasses a broader hydrogen taxonomy including blue hydrogen with CCS, is instructive for India’s own strategic choices. Japan’s willingness to include blue hydrogen reflects its smaller renewable resource endowment and the economic reality that carbon capture may be necessary for industrial-scale decarbonisation in a resource-constrained country. India, with its vast solar and wind resources, is less constrained in this respect, but the cost differentials between green and blue hydrogen remain significant at current technology costs.
Practical and Policy Implications
The practical challenges of land acquisition for large-scale green hydrogen projects are likely to become significant governance issues as Mission projects move from announcement to implementation. The SIGHT scheme has attracted expressions of interest from major industrial groups including Adani, Reliance, JSW, and others. These groups have announced hydrogen projects of enormous scale, requiring not only electrolysis capacity but integrated renewable energy generation, seaport infrastructure for export, and pipeline or truck transport for domestic distribution.
Acquiring thousands of acres of land for these integrated facilities will require Social Impact Assessments under the LARR Act in areas where agricultural communities may have sustained their livelihoods for generations. Several proposed project sites in coastal Gujarat and Rajasthan involve communities with significant land-use claims, including tribal communities with rights under the Forest Rights Act 2006. The intersection of green hydrogen ambition with tribal rights law is an area where careful legal planning is needed before project implementation begins.
The environmental clearance requirements for green hydrogen production complexes also deserve attention. Large-scale hydrogen projects that combine renewable energy, electrolysis, storage, and port infrastructure across thousands of acres will require comprehensive EIA, potentially at the landscape scale, rather than facility-by-facility assessment. The current EIA Notification framework is not well designed for assessing the cumulative environmental impacts of integrated industrial complexes.
Suggestions and Reforms
The Ministry of New and Renewable Energy should, in consultation with CERC, MoEFCC, and industry, develop a comprehensive Green Hydrogen Standard that defines the maximum lifecycle carbon intensity for hydrogen to qualify as “green” under domestic law, specifies requirements for renewable energy sourcing, temporal correlation, and geographic proximity, and provides a methodology for lifecycle carbon accounting. This standard should be designed to be compatible with the EU’s Delegated Regulation to facilitate export market access.
A dedicated Green Hydrogen Regulatory Coordination Authority, with representation from MNRE, CERC, MoEFCC, the Ministry of Jal Shakti, and the Bureau of Energy Efficiency, should be established to resolve jurisdictional conflicts and provide a single-window approval system for green hydrogen project developers. The current fragmentation of regulatory jurisdiction across multiple agencies is a significant project development cost that disadvantages Indian green hydrogen producers relative to international competitors.
The LARR Act’s Social Impact Assessment requirements should be applied to green hydrogen project land acquisition without recourse to emergency provisions, and the SIAs should specifically address water resource impacts, agricultural livelihood displacement, and biodiversity effects in the project area. A national land availability mapping exercise should be conducted to identify sites for green hydrogen development that minimise conflicts with existing agricultural, tribal, and ecological land uses.
Conclusion
Green hydrogen’s emergence as a central pillar of India’s energy transition strategy is well-founded in resource economics and climate necessity. But the legal infrastructure required to translate this strategic aspiration into regulated, equitable, and environmentally sound industrial reality is not yet in place. The definitional gap around what constitutes green hydrogen, the regulatory fragmentation across multiple agencies, the unresolved land acquisition challenges, and the water resource implications all require urgent attention.
The Mission’s 2030 targets for five million tonnes of annual production are achievable in principle but will require sustained regulatory investment, not just financial investment. If India builds its green hydrogen industry on land acquired through inadequate Social Impact Assessment processes, powered by renewable energy that does not meet EU definitional standards, and governed by a definitional framework that does not withstand international scrutiny, the resulting industry will face legal, trade, and reputational challenges that could undermine the Mission’s ambitions. Getting the legal architecture right from the beginning is not an obstacle to ambition; it is the foundation upon which durable ambition must be built.
