PADD 2 — the 15-state region that includes both the Midwest and the Great Plains — is a major player in U.S. hydrocarbon production and refining, not to mention energy consumption, with its rich mix of industry and farming. It’s also bound to be a hot spot in the energy transition, given its vast wind resources, scores of ethanol plants, and extensive plans for carbon capture and sequestration (CCS). Not surprisingly, there also may be a clean hydrogen hub or two in PADD 2’s future — after all, it’s got natural gas in spades, plus lots of zero-carbon nuclear plants, countless wind farms, and more existing and potential hydrogen end-users than you can shake a stick at. In today’s RBN blog, we discuss the PADD 2 proposals now under development and why they may have a good shot at winning Department of Energy (DOE) support.
A provision in last year’s $1-trillion-plus Infrastructure Investment & Jobs Act provides a total of up to $8 billion in federal funding over five years to support the development of several clean hydrogen hubs around the U.S. Last month, the DOE announced that concept papers from hub proponents are due November 7; full applications are due April 7, 2023; winners will be notified in the fall of 2023; and award negotiations with the winners will be completed in the winter of 2023-24. DOE also said that most of the six to 10 selected proposals will each receive between $500 million and $1 billion in federal support, though it’s possible that a proposal could receive a little less or a little more, depending on its size and need.
For a few weeks now, we’ve been blogging about some of the most promising hub concepts being bandied about. First, we looked at the proposed Houston Hydrogen Hub, then followed that up with blogs on planned clean-hydrogen hubs in the Corpus Christi area, Southern California, and a trio of states — Louisiana, Oklahoma and Arkansas. Most recently, in Everything, we discussed plans for a hub in Appalachia that would be centered in northern West Virginia (and extend into western Pennsylvania and eastern Ohio) and be founded primarily on the production of hydrogen from natural gas by steam methane reforming (SMR) or auto thermal reforming (ATR); the capture and sequestration of a large portion of the carbon dioxide (CO2) generated by that production; and the use of that hydrogen by a wide range of end-users. We also looked at a complementary plan by Equinor, Shell and U.S. Steel to advance a smaller hydrogen hub in the three-state region.
Two clean hydrogen hub proposals are at the fore in PADD 2, one involving four states and the other involving seven. (Wisconsin and Minnesota are participating in both efforts.)
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