Regional Hydrogen Hubs: Developing the Transit for Energy Transition
Oct 18 2023
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“I believe that water will one day be employed as fuel, that hydrogen and oxygen which constitute it, used singly or together, will furnish an inexhaustible source of heat and light, of an intensity of which coal is not capable. …Water will be the coal of the future.”
-Jules Verne, The Mysterious Island (The Abandoned), 1874
Although reliance on coal has been declining, even in 2021, coal still supplied over 10% of the United States’ energy consumption, according to the EIA. But, in a matter of approximately 15 years, many hope that Verne’s vision may be realized to have hydrogen emerge as a plentiful, flexible, and inexpensive source for many of our energy and transportation needs, while significantly reducing the carbon impact on the world around us. In a relatively short period of time (by 2050), the Biden-Harris administration hopes to achieve a zero net carbon impact for the United States economy. In part to further that goal, on November 15, 2021, President Biden signed into law the Infrastructure Investment and Jobs Act, often referred to as the “Bipartisan Infrastructure Law.” The Bipartisan Infrastructure Law, among other things, includes a number of incentives and programs related to clean drinking water, high-speed internet, and clean energy initiatives. Many have focused on the significant expenditures related to solar panel and battery technologies and associated manufacturing. But the Bipartisan Infrastructure Law also contains billions of dollars targeted for the development and commercialization of hydrogen as a significant fuel to decrease reliance on fossil fuels and the related carbon emissions associated with such fuels.
More specifically, the Bipartisan Infrastructure Law seeks to establish a number of regional clean hydrogen hubs — a network of clean hydrogen producers, consumers, and infrastructure. They aim to advance the use of clean hydrogen in various sectors, such as manufacturing, transportation, and energy storage with the ultimate goal of scaling hydrogen production to make it cost competitive and cost effective.
As a significant step toward such commercialization, seven Regional Hydrogen Hubs recently were selected to receive up to a combined $7 billion in public funds pursuant to the Bipartisan Infrastructure Law. The law provides for up to $8 billion in such hydrogen-related projects. Under the approved hubs’ applications, such funds would be joined by $40 billion in private funds to further the use of hydrogen in energy production, transportation, agricultural production, and steel and glass manufacturing. The Regional Hydrogen Hubs also strive to lower-costs associated with hydrogen production, storage methodologies and facilities, as well as to facilitate the commercialization of carbon capture technologies.
The seven Regional Hydrogen Hubs selected on October 13, 2023, were:
By way of background, in September of 2022, the U.S. Department of Energy (“DOE”) initiated a Request for Information to solicit feedback from industry, government agencies, state and local coalitions, academia, research laboratories, community-based organizations, and other stakeholders regarding the solicitation process and implementation strategy for between six and ten regional hydrogen hubs and up to $7 billion in public funds. In response, the DOE received 79 initial concept papers for regional hydrogen hubs. After assessing such papers, in early 2023, the DOE provided feedback on the proposals and encouraged the filers of 33 proposal papers to complete and submit final applications for the program by April 7, 2023. Approximately 20 applications ultimately were submitted, and, on October 13, 2023, the DOE identified seven successful hub projects to move forward.1
An additional $1 billion in DOE hydrogen funds under the Bipartisan Infrastructure Law remain, for which the agency had issued a separate Request for Information and is assessing demand-side proposals for clean hydrogen.
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The summer of 2023 was Earth’s hottest since global records began in 1880, according to scientists at NASA’s Goddard Institute of Space Studies (GISS) in New York. “Summer 2023’s record-setting temperatures aren’t just a set of numbers – they result in dire real-world consequences. From sweltering temperatures in Arizona and across the country, to wildfires across Canada, and extreme flooding in Europe and Asia, extreme weather is threatening lives and livelihoods around the world,” said NASA Administrator Bill Nelson. “The impacts of climate change are a threat to our planet and future generations….” The record-setting summer of 2023 continues a long-term trend of warming. Scientific observations and analyses made over decades by NASA, National Oceanic and Atmospheric Administration (NOAA), and other international institutions have suggested this warming has been driven primarily by human-caused greenhouse gas emissions.
The current administration’s (and several other countries’) goal of achieving net zero carbon emissions by 2050 involves an aggressive timetable and will require significant changes (including new technologies and more efficient commercialization of existing technologies and processes) in some of the economy’s key sectors – energy, transportation, and industrial manufacturing, among other economic sectors. Such changes during the energy transition no doubt will require significant capital expenditures over the coming decades.9 Significantly greater use of hydrogen in these sectors (and particularly clean hydrogen at much lower costs) will be important to moving toward a lower carbon footprint (whether in 15 years or thereafter). The important work of these multifaceted and diverse Regional Clean Hydrogen Hubs (as well as others in the industry) will hopefully make brisk and meaningful contributions to our energy, manufacturing, automobile, aviation, public transit, and heavy transportation sectors in our energy transition.
1 The description of each Hydrogen Hub selected (and listed below), as well as of its proposal, is taken from the DOE’s October 13, 2023 Release, Biden-Harris Administration Announces $7 Billion For America’s First Clean Hydrogen Hubs, Driving Clean Manufacturing and Delivering New Economic Opportunities Nationwide.
2 ARCH2 involves the participation of, among others, Battelle, GTI Energy, Allegheny Science & Technology (AST), and the TRC Companies.
3 ARCHES is a public-private partnership to create a sustainable statewide clean hydrogen (H2) hub in California and beyond, utilizing local renewable resources to produce hydrogen with the objective to fully decarbonize the regional economy, while prioritizing environmental justice, equity, economic leadership, and workforce development.
4 HyVelocity, is an industry-led hub that includes seven core industry participants: AES Corporation, Air Liquide, Chevron, ExxonMobil, Mitsubishi Power Americas, Orsted, and Sempra Infrastructure. HyVelocity is administered by GTI Energy, and includes a wide array of organizations, including organizing participants, The University of Texas at Austin, the Center for Houston’s Future, and Houston Advanced Research Center, and HyVelocity also has 90+ supporting partners from industry, community engagement and labor organizations, non-profits, academic, and state and local governments.
5 The University of North Dakota’s Energy & Environmental Research Center (EERC), Marathon Petroleum Corporation (MPC), TC Energy, and Xcel Energy are leading HH2H’s development. MPC and TC Energy are engaged with the Mandan, Hidatsa, and Arikara Nation and Sumitomo Corporation of Americas to establish their meaningful participation in the initiative.
6 Led by Connected DMV (a regional non-profit that delivers complex cross-sector initiatives across industry, government, academia, and community), the Mid-Atlantic Hydrogen Hub consists of leading industry, government, and educational institution Element Entities as well as trusted community partners and labor leaders. These participants have track records of delivering responsible operations and community benefits in both regulated and competitive markets and are already collaborating with the Hub.
7 The Midwest Alliance for Clean Hydrogen is a multistate alliance of public and private entities who have joined together to grow the regional hydrogen value chain. This alliance includes carbon-free energy producers, national labs, leading universities, hydrogen technology providers, diverse hydrogen end users across sectors and environmental justice organizations who are committed to delivering clean hydrogen to power our communities and create a carbon-free economy.
8 The Pacific Northwest Hydrogen Association brings together key players in the industry to respond to the opportunity, build the infrastructure necessary to form such a hub and integrate it into the state’s clean energy portfolio, eliminate fossil fuels from its electricity generation portfolio by 2045 and adopt a 100% clean electricity standard as well as net-zero greenhouse emissions by 2050. Association partners include the Consortium for Hydrogen and Renewably Generated E-Fuels (CHARGE) Network, Renewable Hydrogen Alliance (RHA), Washington Green Hydrogen Alliance, Washington State University, Pacific Northwest National Laboratory, and many private corporations, utilities, and ports. These partners all have the common goal of securing a Hydrogen Hub in the Pacific Northwest.
9 Estimates range wildly with some estimates suggesting that tens of trillions of new capital infusions will be required, while a recent McKinsey report suggesting that the price tag globally may be in the hundreds of trillions.