THP-E279: Will Texas Lead The Charge For Hydrogen Production In The US? Also, Harvard Talks H2 Scaling.

Paul Rodden • Season: 2024 • Episode: 279

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Welcome to The Hydrogen Podcast!

In episode 279, Texas is prepping for the hydrogen wave and Harvard Business School takes a look at hydrogen scaling costs by 2030. I’ll go over all of this on today’s hydrogen podcast.

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Paul Rodden



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Start Here: The 6 Main Colors of Hydrogen


Texas is prepping for the hydrogen wave and Harvard Business School takes a look at hydrogen scaling costs by 2030. I’ll go over all of this 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 that 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 in the Houston Chronicle on January 7, Mella McEwen writes Texas forges ahead in hydrogen development, with inaugural council meeting. Texas legislators last year tasked the Railroad Commission with establishing the Texas Hydrogen Production Policy Council to oversee development of the state’s hydrogen potential. The agency announced this week it has selected 11 council members to serve alongside Railroad Commission Chairman Christi Craddick. The first meeting was held in mid-December. In a quote from Susan Shifflett, executive director of the Texas hydrogen Alliance hydrogen is blowing and going in Texas to say the least. Speaking with the Reporter-Telegram by telephone, she noted that representatives of five of her association’s members – GTI Energy, Port of Corpus Christi, Chevron, CenterPoint Energy and Air Liquide – are on the council. The goal, she added, is to receive guidance on transporting, distributing and storing hydrogen. Under the legislation, House Bill 2847, the council is tasked with making recommendations to the Legislature on updates necessary for the oversight and regulation of production, pipeline transportation, and storage of hydrogen. Duties will include developing a state plan for hydrogen production oversight by the commission, analyzing the development of hydrogen industries around the state, and monitoring regional efforts for the application and development of a clean hydrogen hub authorized under the federal Infrastructure Investment and Jobs Act. Shifflett said the recent selection of the Houston region for a federal Gulf Coast hydrogen hub, with $1.2 billion in federal funding available is just the beginning of hydrogen development in Texas. Multinational majors like ExxonMobil, Chevron and ConocoPhillips are looking at hydrogen and the effort is also attracting smaller companies and entrepreneurs. Texas has a pipeline infrastructure that can carry hydrogen to Texas ports for export, she pointed out. She believes hydrogen will be the bridge between the energy of today and the energy of tomorrow. The Permian Basin has a role to play She also added not only is the region home to solar arrays and wind farms that can provide energy needed to produce hydrogen but oil and gas are sources of hydrogen. She also said everybody likes to use the term energy transition, but she prefers to use the terminology energy expansion. While there are different types of hydrogen blue, green and brown shifflett said her alliance is all about growing hydrogen energy. She also added her lanes plans to embark on education efforts from rules and regulations regarding hydrogen production, transportation and storage to training first responders to safely respond to hydrogen related incidents. Newly-appointed council members are: Richard Fenza from Air Liquide, Preston Kurtz from Air Products & Chemicals, Nigel Jenvey from Baker Hughes, Keith Wall from CenterPoint Energy, Ian Lindsay from Chevron New Energies, Angie Murray from Enterprise Products, Scott Anderson from Environmental Defense Fund, Brian Weeks from GTI Energy, Jeffrey Pollack from Port of Corpus Christi Authority, Brian Korgel from the University of Texas and Kelsie Van Hoose from Williams Companies. Okay, so Texas is on the move actively pursuing hydrogen development, and this should be expected much of the clean hydrogen produced in the state doesn’t require the 45 V to be cost effective, and the Gulf Coast is already set up with more than enough infrastructure for export either as ammonia, methanol or pure hydrogen. What I want to see develop though is offtake opportunities within the state. And the potential is there with off takers with heavy co2 emitting industries, heavy duty transportation, rail as well as derivatives such as fertilizer and syn-fuel utilization. But when hearing this news of super major energy companies pushing for massive growth, don’t be surprised when smaller operators are able to set up modular hydrogen units to service local needs. The Houston Chronicle is right. Texas will be the leading state for hydrogen production, but it also needs is to be the leading state for hydrogen use. Next, in an article in the Harvard Business School, Desmond Dodd writes could clean Hydrogen become affordable at scale by 2030? Desmond writes, Hydrogen is poised to move from the sidelines of global clean energy as the industry learns to produce it more efficiently and at lower cost, according to newly published research led by Gunther Glenk, a climate fellow with Harvard Business School’s Institute for the Study of Business in Global Society (BiGS). Hydrogen is an energy carrier with the potential to power long-haul travel and shipping, or energy-intensive manufacturing—without producing carbon dioxide emissions. The hitch: expanding hydrogen production will likely hinge on substantial cost and efficiency improvements. Governments around the world have recently introduced sizeable regulatory initiatives and subsidy programs to push companies to develop and manufacture new hydrogen equipment. Policymakers and energy experts see hydrogen as a potentially more reliable decarbonized source that could complement more intermittent power suppliers, such as wind and solar energy installations. The incentives likely will help drive down production costs as industry players overcome steep learning curves, Glenk says. He predicts that the cost to produce clean hydrogen will start to approach $1 per kilogram by 2030. That’s the target the US Department of Energy’s Hydrogen Shot initiative has set as part of its mission to accelerate the development of clean energy solutions. The new paper, “Advances in Power-to-Gas Technologies: Cost and Conversion Efficiency,” was published in the journal Energy & Environmental Science. Glenk coauthored the study with Philip Holler, a doctoral student at the University of Mannheim, and Stefan Reichelstein, a senior fellow at the Precourt Institute of Energy at Stanford University. The study estimates how long it would take to produce large-scale clean energy at lower cost for different hydrogen technologies. The research is based on the assumption that, with experience, manufacturers and operators of a particular technology learn to become more efficient and reduce costs. Glenk, Holler, and Reichelstein studied the investment expenditures and energy consumption of power-to-gas facilities, which produce hydrogen without emitting greenhouse gases. The research also captured the capacity of power-to-gas facilities commissioned worldwide between 2000 and 2020. Based on this data, the authors project that the lifecycle cost of clean hydrogen production will likely fall to the range of $1.60-1.90 per kilogram by 2030 from $3-5 today. Investors often doubt the ambitious sustainable energy targets that governments and international agencies set in their bids to reach net zero emissions. But this new research shows that industry trends are moving toward the Department of Energy target. One major obstacle for hydrogen: high production costs have deterred major investments that would meaningfully increase productivity. So far, private investment in the sector mostly has been limited to smaller-scale and niche projects. “When it comes to big infrastructure projects, like in the energy sector, you have to make big investments to really bring down costs,” said Hergen Wolf, director of product management at Germany-based Sunfire GmbH, an innovator in hydrogen and alkaline technologies. Hydrogen projects planned through 2030 have drawn $320 billion in announced investments, up 35 percent since 2022, according to the Belgium-based Hydrogen Council. But fewer than 10 percent of those projects have committed capital. To be on track to reach net zero in 2050, the council notes, announced investments must more than double and all those projects must launch. It has been difficult to make the business case for large-scale hydrogen production to date, says Wolf, because the cost is too high at the outset—40 percent to 70 percent higher than the 2030 cost forecast in the new research—to justify the upfront expenditure. Therefore, the industry perceives that big investments suffer from “first-mover disadvantage,” Wolf said. “It is why we need policy support at the beginning, to get over this disadvantage.” That policy support is starting to help achieve the cost reduction forecast in the paper. For instance, the year-old Inflation Reduction Act offers a tax credit for clean hydrogen production of as much as $3 per kilogram, and is likely to advance the deployment growth of power-to-gas systems. The European Union, home to the highest concentration of announced hydrogen projects, also is providing incentives to member states to collectively produce 20 million tons of green hydrogen annually by 2030. In October, the US Department of Energy announced that it would spend $7 billion to launch seven Regional Clean Hydrogen Hubs across the country. These hubs will create “energy ecosystems” with a goal of producing commercial-scale hydrogen that’s economically viable. “Once you have deployment in place, you get cost reductions,” Glenk said. “With cost reduction, there’s more deployment because more applications become financially attractive, which then leads again to more deployment and cost reduction.” It is a virtuous cycle, Glenk said, that can change the game entirely. Okay, so some interesting research from HBS on the declining cost for hydrogen development. Now while I’ve covered the 45 V and the three pillars several times lately, it is important as this article demonstrates the need to keep a global focus on the hydrogen economy, the US had its first unveiling of the potential hurdles that hydrogen operators will need to get over to claim the full $3 per kilogram credit. And Europe has something very similar, just much less restrictive. I would imagine other nations will follow suit to promote clean hydrogen production and will likely come from maybe Australia or Saudi Arabia. And following that, I believe we’ll also see the rise of the Import Export hub city, Houston being one of those cities, but also London, Amsterdam, Perth, neom as it gets developed, and others. As that happens, I’ll be curious to see if a commodity market follows similar to natural gas spot pricing, or will hydrogen generation be so localized that the geographic dispersion makes that next to impossible? Either way, things are looking up in 2024 for global hydrogen market takeoff and I am fully on board. Alright, that’s it for me, everyone. If you have a second, I would really appreciate it. If you could leave a good review on whatever platform it is that you listen to Apple podcast, Spotify, Google, YouTube, whatever it is, that will be a tremendous help to the show. And as always, if you ever have any feedback, you’re going to email me directly at So until next time, keep your eyes up and honor one another. Hey, this is Paul. I hope you liked this podcast. If you did and want to hear more. I’d appreciate it. If you would even subscribe to this channel on YouTube, or connect with your favorite platform through my website at Thanks for listening. I very much appreciate it. Have a great day.