India's Budget 2026: Rs 17,490 Crore Signals the NGHM Execution Phase

India's Union Budget 2026 committed Rs 17,490 crore to green hydrogen — not aspirational targets, but allocated funding split across electrolyser manufacturing, production capacity, and refinery conversion. Paired with 25-year transmission charge waivers and 100% FDI under the automatic route, this marks the transition from mission statement to scale.

Electrolyser Manufacturing (SIGHT Scheme)

15 companies awarded 3,000 MW/year cumulative manufacturing capacity
Rs 4,440 crore in incentives
Domestic supply-side now has financial certainty

Green Hydrogen Production

18 companies awarded 862,000 tonnes/year capacity
SECI green ammonia: 724,000 tonnes/year for fertiliser unit conversion
Production incentives creating demand-side pull

The 25-Year ISTS Waiver

This detail changes project economics more than any other single policy:

Zero transmission charges for 25 years from commissioning
Applies to both hydrogen and ammonia plants
Valid for projects commissioned by December 31, 2030
Covers renewable equipment through SEZ/EOU routes

For a 50 MW electrolyser, ISTS charges can run Rs 20-25 lakh/month. Over 25 years, that is Rs 60-75 crore in savings per project — the difference between $6-8/kg delivered cost and $4-5/kg. Export competitive.

Certification Surge Ahead

These 18 production companies and 2 refinery suppliers are already in FID discussions. Many will launch pilot operations in 2026. GHCI certification is required before they can claim production incentives:

Renewable power verified per MNRE regulations
Electricity tracking at GHCI hourly granularity
Emissions baseline calculated against GHCI methodology
Third-party certification issued

Most projects today are building facility infrastructure. By Q2, they will be building compliance infrastructure.

PSU Engagement Accelerates

PSU projects that were "exploring" green hydrogen now have FID timelines:

NTPC: Green hydrogen offtake commitments validate capital allocation. FID decisions expected mid-2026.
GAIL, IOCL, BPCL: Refinery ammonia conversion projects have direct budget line items.
NTPC Assago (UP): Green urea project eligible for these incentives.

Strategic Implications

The budget does three things simultaneously:

Validates the market thesis: India commits to 5 MMTPA by 2030 with government-backed demand creation
Compresses timelines: Project economics improve 25-30% with ISTS waivers, accelerating FIDs
Creates competitive differentiation: First-movers on certification infrastructure gain access to 18-20 qualified customers

The companies that embed GHCI-ready design by mid-2026 will operate with near-zero certification friction. Those who delay will lose 12-18 months to rework and audit cycles.

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