April 04, 2022 • Paul Rodden • Season: 2022 • Episode: 104
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In episode 104, Can political differences in the United States be overlooked in order to advance the hydrogen ecosystem? I'll go over West Virginia's bid for a hydrogen hub on today's hydrogen podcast.
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Can political differences in the United States be overlooked in order to advance the hydrogen ecosystem? I'll go over West Virginia's bid for a hydrogen hub on today's hydrogen podcast.
So the big questions in the energy industry today are, how is hydrogen the primary driving force behind the evolution of energy? Where is capital being deployed for hydrogen projects globally? And where are the best investment opportunities for early adopters who recognize the importance of hydrogen? I will address the critical issues and give you the information you need to deploy capital. Those are the questions will unlock the potential of hydrogen and this podcast will give you the answers. My name is Paul Rodden and welcome to the hydrogen podcast.
In an article from E&E news, Scott Waldman writes Biden and Manchin speak different languages on hydrogen. The Void on climate policy between President Biden and Senator Joe Manchin might be filled by hydrogen. Both agree that expanding the use of hydrogen is essential If the US is going to cut its carbon emissions. Hydrogen could be used to power tomorrow's cars, power plants and cargo ships. That's where the similarities end. Biden's version of hydrogen is made using renewable energy and would replace hydrocarbons Manchin by contrast envisions relying on hydrocarbons to produce hydrogen. Now Manchin, a West Virginia Democrat, wants the Biden administration to put one of its new four hydrogen hubs in his backyard. Manchin and other West Virginia politicians recently hosted Energy Secretary Jennifer Granholm Interior Secretary Deb Haaland and other administration officials on visit to the state. Part of the discussion centered around building a new hydrogen hub in West Virginia. Funding for the hydrogen hubs was tucked into the $1.2 trillion bipartisan infrastructure law that Manchin helped write it included $8 billion for the creation of four regional clean hydrogen hubs, and specifically called on the Department of Energy to designate individual hubs that use hydrocarbons, nuclear, and renewable energy.
It also required one of the hubs to be located in Appalachia. Now for those of you outside of the US, Appalachia is a geographic region in which West Virginia is incorporated. The law defines the hubs as a quote network of clean hydrogen producers, potential clean hydrogen consumers and connected infrastructure located in close proximity that can be developed into a National Clean hydrogen network to facilitate a clean hydrogen economy. Now a key word in this is clean. Situating, one of those hubs in West Virginia could be a major win for the state's natural gas and coal producers. It would also be a victory for Manchin, who advocates for the continued use of hydrocarbons. His support for coal and natural gas led him in part to oppose Biden's landmark climate and social spinning initiative known as build back better. In a statement for Manchin. He says with our abundant energy sources and strong partnerships, our state is uniquely situated to compete for DOE funding to develop a hydrogen hub as provided through his bipartisan infrastructure investment and jobs act. Now after Granholm's visit two weeks ago, mentioned and other politicians from the state launched the West Virginia hydrogen hub coalition to push the Department of Energy to open one of the four hubs in the state. Coalition members include the Oil and Gas Association of West Virginia and the West Virginia coal Association.
Michael O'Boyle, Director of electricity policy for energy innovation, a think tank is skeptical about lowering emissions by developing hydrogen derived from hydrocarbons. He said federal investment should be focused on so called green hydrogen or the kind that's produced using renewable energy. In a statement O'Boyle says, anytime the government is investing in a technology that has dubious claims to being green, under the auspices of reducing emissions, that's problematic and we shouldn't do that. When it comes to hydrogen green hydrogen is the only viable and scalable pathway to cost effective zero carbon fuels. Now, virtually all of the hydrogen produced today, or about 95% of it relies on hydrocarbons. That so called Blue hydrogen is what Manchin and hydrocarbon companies want to expand because it would create a lucrative market for oil and gas to help preserve hydrocarbons as the US aims to half emissions by 2030.
The cheapest way to create hydrogen currently is to strip it from hydrocarbons in a process known as steam methane reforming, that so called grey hydrogen is dominant today and has a high rate of carbon dioxide emissions. Blue hydrogen, on the other hand, which Manchin supports uses carbon capture and storage to reduce those emissions. Manchin is a longtime advocate of hydrogen, and in 2006, when he was the governor of West Virginia, his administration pushed a plan to get hydrogen from coal and last summer in a closed door session with Democratic leaders over the $1.7 trillion build back better Bill Manchin prioritize hydrogen. This according to a memo obtained by Politico. Manchin said a condition for his vote was clean fuel tax credits for hydrogen powered vehicles. The White House wants a hydrogen economy based on renewable energy. And so green hydrogen which is made through a process in which electrolysis separates it from oxygen molecules and water, the electricity required for the process can be generated by renewable resources.
White House climate advisor Gina McCarthy has said she envisions the highway for the future lined with electric vehicle charging stations, as well as green hydrogen fueling stations for long haul trucks. But experts say that technology will be highly difficult to scale up and will take significant infrastructure investments and many years to come to fruition. And so since green hydrogen can't be ramped up to scale in the foreseeable future, the pathway to net zero emissions does include hydrocarbon based hydrogen, as long as it's paired with carbon capture technology, said Lindsey Walter, Deputy Director for third ways Climate and Energy Program. And in a quote from Lindsey Walter, the scale of hydrogen use in the US compatible with netzero is enormous. And it's going to be really difficult to meet all of that with green hydrogen. So that's where the US with its natural gas resources. Even with slightly more expensive carbon capture technologies, it becomes a competitive tool. The cost reduce green hydrogen, though, is dropping. Russia's war in Ukraine shows that green hydrogen can be produced more cheaply and without the price spikes of hydrocarbon derived hydrogen. According to a new report from Rystad Energy. While gray and blue hydrogen have been cheaper to produce Russia's war has turbocharged the cost competitiveness of green hydrogen This is according to Rystad Energy. West Virginia officials made it clear that locking in its hydrocarbon resources are key to its bid for a hydrogen hub.
The application cites that the state's role has the number two producer of coal in the United States and the eighth leading producer of natural gas. In addition, the application states there are 4000 miles of pipeline in the state that could be converted to move hydrogen. And in the application itself, it is written in addition to its central location and natural resources, West Virginia also has the geology to store carbon dioxide in deep rock formations that would be captured during the production of hydrogen. Now, West Virginia Governor Jim justice views the state's proposed hydrogen hub as a way to continue burning oil, gas and coal. In a quote from Governor Justice, West Virginia has forever been known as one of the world's leading energy powerhouses. And we want to do everything in our power to make sure we continue to be just that for centuries to come. Okay, so a very good article detailing what has to be on the minds of every energy policy writer and advisor around the world. Now, there are some important things to sift through in this article.
The first is the energy needed to make the hydrogen. So green hydrogen isn't green, because it's using renewable electricity to make the hydrogen, it's really the combination of using renewable electricity to power the electrolysis of water. That's really what green hydrogen is. So to that point. If you're using water for your source of hydrogen, and you're getting that fed off of a coal power plant, you're not doing yourself any favors. Conversely, you can look at turquoise hydrogen, such as Monolith where they're using a methane pyrolysis and the electricity that they're using to generate that energy needed for the methane pyrolysis that comes from renewable energy sources. And also, with that technology, you also get solid carbon as another byproduct instead of co2. Now, all things being equal, I would envision that technology playing out the best in this situation. But I think that the political spectrum is really only looking at green or blue options. And there's also something else that I would like to point out, the application cites the state's role as the number two producer of coal and the eighth leading producer of natural gas. And because of that, they also have 4000 miles of pipeline that can be converted to move hydrogen.
That is not a cheap task. Now, initially, some hydrogen can move through that pipeline. But the cost of inspecting those pipelines once you've inserted hydrogen into them, will increase dramatically. But all that being said, maybe it would be a good idea to take a bigger step back and look at West Virginia's position in the US as becoming a hub for hydrogen. The geology and the rock properties in the Utica and Marcellus basins do look good for carbon capture and sequestration. And geographically the state itself is positioned well to The center point of a transportation network between Pittsburgh, Cleveland, Columbus, Cincinnati, Louisville, Charlotte, Norfolk, and Washington, DC and Baltimore. And so my takeaways as to whether or not West Virginia should be a hydrogen hub, Well... the geology checks out, the geography checks out, and the political situation there is very favorable for this. So really the only question at play is, can they make the hydrogen in a clean enough way that they are able to take advantage of the energy bill and develop a legitimate hydrogen ecosystem in West Virginia?
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