Renewable Projects in SEZs Catering to Green Hydrogen Plants Exempt from ALMM

Renewable energy projects located inside a Special Economic Zone (SEZ) or an Export Oriented Unit (EOU) and supplying power exclusively to green hydrogen (or its derivatives) projects, also located in an SEZ or set up as an EOU, will be exempt from the purview of Approved List of Models & Manufacturers (ALMM) for solar PV modules.

The exemption from ALMM will apply to all such renewable projects commissioned by December 31, 2030, according to an office memorandum issued by the Ministry of New and Renewable Energy (MNRE).

The ministry defines green hydrogen as hydrogen produced using renewable energy, including but not limited to production through electrolysis or biomass conversion.

The ALMM exemption for renewable projects supplying power exclusively to green hydrogen projects comes in the context of the government taking a series of initiatives to promote the production of green hydrogen under the National Green Hydrogen Mission.

In March, MNRE allocated ₹44.4 billion (~$535.6 million) to incentivize the manufacturing of electrolyzers to reduce costs for hydrogen production in the country as part of NHGM, which has a budget of ₹197.44 billion (~$2.3 billion) up to 2029-30.

The mission seeks to promote the development of a green hydrogen production capacity of 5 million tons per year and envisages an investment of over ₹8 trillion (~$96.5 billion) by 2030.

In January, MNRE released an implementation framework to incentivize the annual production of 200,000 MT of green hydrogen. The incentives will be granted over three years. Oil and gas companies will be the implementing agencies under the program.

The incentives for producing green hydrogen at the lowest cost for oil refineries through a competitive selection process are part of the Strategic Interventions for Green Hydrogen Transition (SIGHT) program. The program has a total outlay of ₹130.5 billion (~$1.57 billion).

The ministry recently clarified that the ALMM order on solar modules only applies to projects whose last date for bid submission is on or after April 10, 2021. Projects submitted before April 10, 2021, are exempt from the ALMM order, providing flexibility for projects already in the pipeline.


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