U.S. hydrogen hubs What comes next
As described in our previous post, the Department of Energy (DOE) is accepting applications for hydrogen hubs around the country that have the potential to provide significant climate and community benefits through state-of-the-art demonstrations. This blog will outline where things stand with hydrogen hub applicants and what is coming in the next year.
What’s next? Application timeline and next steps for the hydrogen hubs program in 2023
DOE released a funding notice in September of 2022 calling for hub proposals in the form of concept papers from all regions of the United States. An impressive 79 concept papers were submitted in November spanning every region of the United States. Proposals varied broadly and were led by individual companies, universities, nonprofits, and city/state government consortiums. DOE announced initial decisions in December 2022, “encouraging” 33 of the 79 applicants to move forward from the concept paper stage to submit full applications. Full applications are due on April 7th, 2023.
We are seeing applications develop all over the country, primarily around ports and industrial regions, with a diversity of production pathways and proposed end-uses that involve a wide variety of stakeholders, which are outlined in more detail below:
State & local governments are often playing a convener role and are excited about the prospect of bringing new investments and jobs to their regions. They are tackling collective action problems like the buildout of universally beneficial hydrogen infrastructure.
Industry & project developers are playing technical scoping and project planning roles and getting involved as producers, off-takers, and end-users.
Research institutions & nonprofits are working to ensure that proposed hubs are viable and poised to deliver intended climate and community benefits. They are advocating for policy and regulatory changes needed to enable safe and streamlined hydrogen development
Community groups play a critical role in advocating to ensure local community interests like air quality, water quality, project safety, and labor considerations are prioritized, though they are not always integrated formally into hub efforts. As the hubs program progresses, it will be essential for hub awardees to integrate community priorities and groups actively into their plans. In addition to being the right thing to do, 20% of the assessment of each hydrogen hub application will depend on the hub’s Community Benefits Plan (CBP).
From our engagement to date with the stakeholders outlined above, we have noticed a great deal of variation in the way states and regions are approaching the application process. To demystify the process happening behind the scenes, below are a few examples of the types of strategic questions hub applicants have been grappling with over the past few months:
Leadership structure: The organizations leading hub efforts vary greatly. Some hubs are headed by a state or local government while others are headed by private companies, some which were explicitly established to submit and manage the hub proposal. Most have taken a coalition-based approach and are working with a variety of public and private partners to develop their applications.
Privacy: Most applicants have prioritized privacy and have shared little information publicly in the lead up to the application deadline. Some applicants have taken a more inclusive approach, such as California’s ARCHES effort, which has offered public working groups as part of its application effort, while others have maintained smaller and more closed-off working groups.
States & regions: Some hub application efforts represent single states with coalitions built within state lines, while others have taken a multi-state regional approach. Some states (like Ohio, for example) are part of multiple hub application efforts.
Bipartisan Participation: States both red and blue have developed hub applications, many of which are bipartisan efforts like the
Appalachian Regional Clean Hydrogen Hub (ARCH2). In our conversations with hub applicants, some of this collaboration across the aisle was done intentionally with hopes of raising chances of winning funding.
Off-takers: Some applications prioritize one main end-user (such as a steel company) with a significant commitment, and others have hundreds of diverse industry partners signed on but with lighter commitments as off-takers. Some, like ARCHES, have even prioritized end-uses in a few main sectors such as ports, power, and transportation.
After the application process closes, DOE expects to conduct interviews over the summer of 2023 and notify hub applicants that have been selected for funding by fall 2023. After that, award negotiations are expected to continue into 2024. Throughout this process, we will continue to actively track developments, engage with hub stakeholders, and update CATF’s hydrogen hubs map.
CATF’s vision for the hydrogen hubs program
DOE’s Regional Clean Hydrogen Hubs Program is a first-of-a-kind program with significant potential. Collaboration is needed from a diverse range of stakeholders to ensure that the hubs program delivers carbon emissions reductions, maximizes community benefits, and enables the development of connected hubs with long-term economic viability. CATF will be an implementation partner to hub applicants, communities, and the DOE. We are working across regions to ensure that the program realizes its intended impacts of scaling up crucial climate technology and ensuring the benefits are distributed equitably across communities. We are working in partnerships to ensure that low-carbon production pathways, end-uses for maximum climate impact, community engagement, and air quality improvements are prioritized in the selection and development of hydrogen hubs under the Regional Clean Hydrogen Hubs program.
The hydrogen hubs program is a crucial steppingstone towards creating decarbonization options for hard-to-abate sectors including heavy-duty trucking, shipping, aviation, and heavy industry in the United States. Additionally, the program will help catalyze the decarbonization of traditional high-carbon intensity hydrogen production for fertilizer production and oil refining which are responsible for 830 million metric tons of carbon dioxide emissions globally each year. The program represents a massive opportunity for the U.S. to establish itself as a leader in the global clean hydrogen economy, creating new jobs and building wealth in a diverse range of regions across the country. We will update CATF’s Clean Hydrogen Hubs Map in real-time to ensure stakeholders and the public remain informed about how this critical program is developing.
Source: CATF. US