India issues model Electrolyser-as-a-Service contract to cut green hydrogen entry costs
India’s Ministry of New and Renewable Energy has published a standard model service agreement for “Electrolyser-as-a-Service” under the National Green Hydrogen Mission, giving industrial users a ready-made contractual framework to adopt green hydrogen without funding production plants themselves.
Under the build-own-operate structure set out in the model, a technology developer finances, installs, owns and operates an electrolyser plant on the premises of an industrial consumer, who simply buys the hydrogen and oxygen produced while the developer retains responsibility for running the facility. The ministry said the template is intended to simplify contract negotiations, lower transaction costs and improve the ease of doing business for developers and offtakers alike, addressing the heavy upfront capital and operational risk that has slowed industrial uptake.
The agreement proposes a 15-year operating period beginning after a successful performance guarantee test, with a payment structure combining a fixed monthly charge covering equipment leasing and operating costs and annual revisions linked to the consumer price index.
It also sets performance standards for hydrogen output, product purity, energy consumption and plant availability, with incentives for exceeding targets and penalties where agreed levels are missed. Industrial consumers, for their part, must supply the necessary utilities and site infrastructure, secure statutory environmental and safety approvals, and obtain green hydrogen certification under the ministry’s guidelines.
The framework arrives as the model gains commercial traction domestically, with one recent 15-year agreement signed for a 2.5 MW electrolyser in Uttar Pradesh carrying provisions to scale to 50 MW, and it complements incentives already allocated under the mission for 3,000 MW of electrolyser manufacturing and around 862,000 tonnes a year of green hydrogen production capacity.
