It wouldn’t be hard to work up a checklist of the qualities that a major clean hydrogen hub should offer. Easy access to low-cost natural gas for methane reforming, and to carbon sequestration sites for captured carbon dioxide (CO2). Plentiful wind and solar energy to power electrolyzers that split water into hydrogen and oxygen. Lots of available land for clean hydrogen and ammonia production facilities. Nearby refineries and other industrial consumers of hydrogen. And don’t forget export terminals, because the rest of the world will continue to demand U.S.-sourced energy. Well, as we discuss in today’s RBN blog, Corpus Christi seems to check all the boxes.
Hydrogen isn’t a silver-bullet fix for the world’s energy needs, but there’s growing momentum behind the view that it will be part of a solution, and that the U.S. had better get going if it’s going to be a leader in low-carbon hydrogen production and use. As we said in Part 1 of this blog series, the Infrastructure Investment & Jobs Act that President Biden signed into law last November directs the Department of Energy (DOE) to invest up to $8 billion over five years in the development of four or more hydrogen hubs. (The DOE will select the hubs by May 2023.) DOE also will spend another $1 billion on efforts to reduce the cost of producing clean hydrogen from water via renewables-powered electrolyzers to $2/kilogram (from the current $4-plus/kg) by 2026, and another $500 million to help advance equipment manufacturing technologies and techniques for clean hydrogen processing, delivery, storage, etc.
Hydrogen got another boost from the Inflation Reduction Act (IRA) that became law on August 16. Among other things, the IRA will provide production tax credits (PTCs) of up to $3/kg of “green” hydrogen produced, which goes a long way in improving the economics of renewables-powered electrolysis projects in particular. (See Name Game, our blog about the IRA, for details.)
Last time, in Part 2 of our series on hydrogen hubs, we examined the proposed Houston Hydrogen Hub, an effort led by the Center for Houston’s Future as part of the Greater Houston Partnership’s Houston Energy Transition Initiative (HETI). As we said then, there are many facets to HETI’s case that the Houston area deserves to be selected as one of the DOE’s new hydrogen hubs, but perhaps its most compelling argument is that so much of what’s needed to develop a hub and enable it to thrive is already in place along the coastal stretch between Freeport, TX, and the southwestern corner of Louisiana. Put simply — and we acknowledge some bias — it would be hard to imagine the DOE not selecting greater Houston as one of its handful of new hydrogen hubs.
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