GREY HYDROGEN : The Most Common and Most Controversial Form of Hydrogen

In the worldwide attempt to lower greenhouse gas emissions, Hydrogen is attracting interest as a possible game-changer. Promoted as a clean fuel that emits only water when burned, Hydrogen seems like the perfect answer for decarbonizing hard-to-abate sectors like heavy industry, aviation, and long-distance transport. However, the actual environmental benefits of Hydrogen depend entirely on its production method. Among the various types of hydrogen being produced, Grey Hydrogen is the most often produced and used worldwide.

How Grey Hydrogen is produced?

Grey hydrogen is made from fossil fuels, primarily natural gas, using a process called steam methane reforming (SMR). In this process, methane (CH₄) reacts with high-temperature steam under pressure, producing Hydrogen (H₂) and carbon monoxide (CO). This carbon monoxide is then reacted with water (H₂O) to produce additional Hydrogen and carbon dioxide (CO₂). While the Hydrogen is captured and used in industry, the CO₂ byproduct is released directly into the atmosphere. This production method emits large volumes of greenhouse gases and yet currently accounts for over 90 percent of Global Hydrogen production.

Source:Research Gate

Cost and its Impact on Environment

The wide appeal of Grey Hydrogen lies in its cost and scale. The technology behind SMR is mature, and the infrastructure already exists in many parts of the world. It is less expensive than producing Hydrogen using renewable electricity, and so far, no alternative method has yet matched it in terms of affordability and industrial readiness. Grey Hydrogen is indispensable to industries such as oil refining, ammonia and fertilizer production, methanol synthesis, and various chemical. Without it, many essential products—from fuel to food—would become significantly more expensive or difficult to manufacture.

However, there is a significant environmental cost associated with this cost-effectiveness. For every kilogram of Grey Hydrogen that is produced via SMR, between 9 and 12 kilograms of carbon dioxide is released. This indicates that although Hydrogen itself is clean when used, its production is not environment friendly. It not only contributes to global CO₂ emissions but also relies on a fossil fuel for its production which is natural gas and that has its own environmental and geopolitical ramifications. Methane leaks during natural gas extraction and transportation further compound the climate impact, as methane is a far more potent greenhouse gas than carbon dioxide over the short term.

Grey Hydrogen is therefore a bit of a paradox. On the one hand, it facilitates vital industrial operations and supports decarbonizing energy systems. On the other, it significantly worsens the very problem Hydrogen is supposed to help solve: climate change. Grey Hydrogen is still the most affordable and scalable option available, which is why it continues to dominate the industry despite its environmental drawbacks. Some policymakers and experts argue that it can serve as a transition technology, buying time for cleaner Hydrogen alternatives to become cost-competitive. However, others worry that continued reliance on Grey Hydrogen delays vital actions at a time when the climate crisis necessitates immediate change.

What is India Doing?

India is actively working to reduce the environmental impact of Grey Hydrogen through several government-led initiatives aimed at promoting Green Hydrogen. The flagship National Green Hydrogen Mission, launched in 2023, targets the production of 5 million metric tonnes of Green Hydrogen annually by 2030, supported by ₹19,744 crore in funding. The government has also introduced the Green Hydrogen Standard, defining strict emission thresholds for certified Green Hydrogen. Under the SIGHT (Strategic Interventions for Green Hydrogen Transition) program, incentives are provided for Green Hydrogen production and domestic electrolyzer manufacturing.

In a world striving for net-zero emissions, Grey Hydrogen is unlikely to survive in the long run. However, it continues to play a key role in the Hydrogen economy in the near future. Managing this reality and using Grey Hydrogen in a practical way without compromising climate goals is the problem. This might mean mandating carbon capture for existing plants, taxing emissions to make clean Hydrogen more competitive, or accelerating research and development into Green Hydrogen technologies.

Written By: PuspaKumari, Research Assistant, The Energy Forum.