Shortlisted US hydrogen hubs to receive $7bn funding

The seven shortlisted projects have been allocated a proportion of a US$7 billion fund to develop renewable hydrogen hubs (H2Hubs). If all the shortlisted projects proceed, they will produce 3 million tonnes of hydrogen per year, representing almost one-third of the US’s 2030 production target of 10 mt.

The initial tranche of the US$7bn award will be allocated for the development of detailed project proposals, with the bulk of the funding awaiting US Department of Energy (DoE) approval for the project plans prior to disbursal.

The projects are expected to attract co-funding from individual project participants of up to US$40bn, which could potentially lead to a US$50bn investment in renewable hydrogen production in the US if all the projects proceed.

The seven regional hubs are widely distributed geographically, ranging from the Pacific Northwest and California to the Midwest states and the mid-Atlantic seaboard.

The hydrogen hubs have been chosen to cover a wide range of potential production routes for renewable hydrogen, including a blue hydrogen focused hub incorporating carbon capture in the Appalachian region, that is likely to seek to make use of the region’s disused mining areas as potential locations for carbon sequestration. The Midwest Hydrogen Hub is seeking to produce electricity from regional nuclear generators to produce hydrogen.

Several of the potential hydrogen hubs will have direct maritime applications, with the California hub focused on producing green hydrogen via electrolysis which could then help to decarbonise port operations at the Port of Long Beach, as previously reported by The Motorship.

The Gulf Coast hydrogen hub, which includes ExxonMobil and Chevron among its project participants, was awarded US$1.2bn. The project includes the production of e-methanol for maritime fuel among its end-use markets.

Among projects that are expected to have an indirect impact on improving the feasibility of exporting US hydrogen is the Pacific Northwest Hydrogen Hub, which cites improvements in the efficiency of hydrogen electrolyser technology among its objectives. The US administration is targeting an 80% reduction in the cost of producing hydrogen to US$1/kg by 2030 as part of a drive to develop a flourishing hydrogen vector export sector.

The Motorship notes that the precise terms of a US tax credit for low-emissions hydrogen production is likely to encourage significant inward investment into the sector.

The seven shortlisted projects have been allocated a proportion of a US$7 billion fund to develop renewable hydrogen hubs (H2Hubs). If all the shortlisted projects proceed, they will produce 3 million tonnes of hydrogen per year, representing almost one-third of the US’s 2030 production target of 10 mt.

The initial tranche of the US$7bn award will be allocated for the development of detailed project proposals, with the bulk of the funding awaiting US Department of Energy (DoE) approval for the project plans prior to disbursal.

The projects are expected to attract co-funding from individual project participants of up to US$40bn, which could potentially lead to a US$50bn investment in renewable hydrogen production in the US if all the projects are delivered.

The range of hubs include a number of different potential end-user markets, including heavy transportation, steel production and fertiliser production. The Motorship notes that EU based fertiliser producers have warned that a shift towards the use of green ammonia (a hydrogen carrier) in fertilise production risks increasing the factory gate price of fertiliser by three to four times.