With the sudden removal of its February green energy incentives, the northeastern state leaves millions of dollars in planned investments for green hydrogen projects in jeopardy.

According to a document examined by Reuters and people with direct knowledge of the situation, the northeastern Indian state of Assam has thrown doubt on millions of dollars in planned investments by withdrawing its flagship clean energy policy, which was announced in February.

By providing financial incentives and waivers earlier this year, Assam, the largest state in northeastern India, aimed to draw investments to an area that has lagged in the adoption of renewable energy. The February policy relaxed bank guarantees requirements and provided power transmission subsidies to help fund clean energy projects in the state. A cabinet decision led to the withdrawal of the integrated clean energy policy, according to an internal memo dated July 18 that Reuters examined. However, the memo did not explain the reversal.

An email from Reuters asking for comment on the policy withdrawal was not answered by Assam's power department. Industry sources reported that the Assam government has not formally withdrawn the clean energy policy.

According to the sources and bid documents Reuters examined, energy companies have submitted bids for green hydrogen projects in Assam, including NTPC Green, Larsen & Toubro, Singapore-listed Sembcorp, and Abu Dhabi-based Ocior.

According to a senior NTPC official who wished to remain anonymous because of the delicate nature of the subject, inconsistent state government policies present obstacles to planned investments. To the surprise of investors, Assam halted its flagship green hydrogen policy in June, according to a Reuters report.