Decarbonizing India's Industrial Sector: Analysis of the Combined Impacts of the Perform, Achieve, Trade Scheme and the National Green Hydrogen Mission

This study presents a system‐level assessment for India, examining the role of the industrial sector in the nation's net‐zero transformation, given its substantial contribution to greenhouse gas emissions and the distinct challenges it faces in decarbonization. This paper analyses the joint effects of two flagship Indian policy mechanisms, the Perform, Achieve, and Trade (PAT) energy efficiency program and the National Green Hydrogen Mission (NGHM) using the India Energy Policy Simulator (EPS) and the energyRt optimization model, which are sequentially coupled to link policy‐driven demand evolution with cost‐optimal energy and hydrogen system pathways. Model inputs are derived from the Bureau of Energy Efficiency's PAT database, the Ministry of New and Renewable Energy (MNRE), the International Energy Agency (IEA), and the International Renewable Energy Agency (IRENA) for the period 2020–2050, supplemented by datasets embedded within the EPS and energyRt frameworks. Decomposition analysis shows that deployment of green hydrogen provides around 42% of cumulative abatement potential, followed by efficiency improvements under PAT, which contributes 16%, highlighting their complementary nature. An economic and financial evaluation indicates that PAT achieves cost‐effective near‐term savings through energy efficiency, while NGHM leverages huge investment mobilization to render green hydrogen cost‐competitive by mid‐century. Sensitivity analysis stresses the key role of timely policy intervention and falling technology costs in preventing lock‐in of emissions. Outcomes are sensitive to assumptions regarding technology costs, carbon pricing and data availability for small and medium enterprises (SMEs) and process emissions. By integrating policy design insights with quantitative modelling, this study demonstrates that combining PAT and NGHM offers a scalable pathway for industrial decarbonization aligned with India's long‐term net‐zero ambitions. The results suggest that under coordinated policy scenarios, PAT and NGHM together account for a substantial share of cumulative industrial emissions reductions by 2050, with efficiency‐driven abatement dominating in the near term and hydrogen substitution becoming increasingly important after 2035.