The US Department of Energy (DOE) has allocated $7b to support the launch of seven regional clean hydrogen hubs across the country, with the combined potential to meet 30% of the government’s 2030 production target.

The move is designed to kickstart a national network of producers, consumers and associated infrastructure to accelerate the commercial-scale deployment of low-cost, clean hydrogen.

The combined production capacity of all the hubs is expected to be c.3mt/yr. They hubs span the full range of technology from renewables and nuclear power electrolysis to natural gas-based production with CCS and biomass.

“Unlocking the full potential of hydrogen—a versatile fuel that can be made from almost any energy resource in virtually every part of the country—is crucial to achieving President Biden’s goal of American industry powered by American clean energy, ensuring less volatility and more affordable energy options for American families and businesses,” said US Secretary of Energy Jennifer Granholm.

3mt/yr – Total production capacity

“With this historic investment, the Biden-Harris administration is laying the foundation for a new, American-led industry that will propel the global clean energy transition while creating high quality jobs and delivering healthier communities in every pocket of the nation.”  

The funding, which is subject to negotiations with each of the hubs, will add to the momentum gained by the US hydrogen sector since the passing of the Inflation Reduction Act (IRA). After a slow start, the US has caught up with Europe over the last year in the race to develop a hydrogen economy. A growing list of Europe-based developers and electrolyser manufacturers are establishing a presence in the North American market.

However, a lack of clarity over aspects of the implementation of the Inflation Reduction Act—including methodologies for determining carbon intensity levels, which dictate the level tax credits available to projects—has prevented projects moving forward to FID, according to some in the industry.

The DOE recently acknowledged the need to do more to develop the demand side with the launch of a demand-focused $1b support programme. The following projects have been selected to enter funding negotiations:

Appalachian Hydrogen Hub (up to $925m)

The hub spans West Virginia, Ohio and Pennsylvania. It will leverage the region’s ample access to low-cost natural gas to produce low-cost clean hydrogen and permanently store the associated carbon emissions. The project includes the development of hydrogen pipelines, multiple hydrogen fuelling stations and permanent CO₂ storage.

California Hydrogen Hub (up to $1.2b)

The hub will make use of California’s leadership in clean energy technology to produce hydrogen exclusively from renewable energy and biomass. It will provide a “blueprint” for decarbonising public transportation, heavy-duty trucking and port operations, the DOE said.

Gulf Coast Hydrogen Hub (up to $1.2b) 

The hub will be centred in the Houston region. Plans include production using both natural gas with CCS and renewables-powered electrolysis, employing the Gulf Coast region’s abundant renewable energy and natural gas supply.

Heartland Hydrogen Hub (up to $925m)

The project spans Minnesota, North Dakota and South Dakota. It will leverage the region’s abundant energy resources to help decarbonise the agricultural sector’s production of fertiliser, cut the regional cost of clean hydrogen and advance the use of clean hydrogen in electric generation and for cold climate space heating.

Mid-Atlantic Hydrogen Hub (up to $750m)

The project spans Pennsylvania, Delaware and New Jersey. Plans include the repurposing of legacy oil infrastructure. It plans to develop renewable hydrogen production facilities from renewable and nuclear power using both established and innovative electrolyser technologies.

Midwest Hydrogen Hub (up to $1b)

The project spans Illinois, Indiana and Michigan. Located in a key industrial and transportation corridor, the hub will enable decarbonisation through hydrogen use in sectors including steel and glass production, power generation, refining, heavy-duty transportation and sustainable aviation fuel. Production routes will include electrolysis from renewable and nuclear, and natural gas-based technologies.

Pacific Northwest Hydrogen Hub (up to $1b)

The project spans Washington, Oregon and Montana. Production will be exclusively from electrolysis powered by renewables. It is anticipated that wide-scale use of electrolysers will play a key role in driving down their costs, the DOE said.

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Author: Stuart Penson