Author: PPD Team Date: 22/04/2025
The Punjab Energy Development Agency has released a draft green hydrogen policy to build a production capacity of 100 kilo tonnes per annum (ktpa) of green hydrogen and ammonia by 2030.
The policy proposes extending incentives from the “Punjab Industrial and Business Development Policy 2022” to new and expanding green hydrogen and ammonia projects. It also highlights regulatory support under the “New & Renewable Sources of Energy Policy 2012”, including full exemption from electricity duty during the construction phase.
To reduce project costs, the draft suggests waiving land use conversion and external development fees for agricultural land being repurposed for industrial use. It also proposes 100 per cent exemption from stamp duty on land registration and lease.
To improve the economic viability of projects, the policy includes exemptions from cross-subsidy and additional surcharges on green energy used for hydrogen and ammonia production. It also offers concessions on contract demand charges and a 50 per cent exemption on intra-state transmission and wheeling charges. Projects commissioned before December 31, 2030, would benefit from a 25-year waiver on inter-state transmission charges by the Central Transmission Utility of India Limited.
The policy introduces a method to allow renewable purchase obligation (RPO) compliance through the use of green hydrogen or ammonia, converting their use into megawatt-hours (MWh). Punjab State Power Corporation Limited may also procure and supply renewable power to producers at tariffs set by the state regulator.
Direct financial incentives are part of the proposal. Biomass-to-green hydrogen projects may receive up to Rs 150 million per project, limited to Rs 30 million per tonne per day capacity and capped at five TPD. This support will be limited to the first ten such projects.
In the transport sector, a capital subsidy of 20 per cent, up to Rs 5 million per vehicle, is proposed for the first 100 hydrogen fuel cell trucks and buses. Industries using green hydrogen may receive a consumption-based subsidy of Rs 50 per kg for five years, limited to the first ten users.
The draft also proposes a 20 per cent capital cost subsidy, capped at Rs 30 million, for the first ten hydrogen refueling stations set up in the state.