February 28, 2023

Suzanne Mattei and David Schlissel and Dennis Wamsted, IEEFA

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It’s a problem of timing. The U.S. Department of Energy (DOE) is about to make decisions on whether to fund methane-based hydrogen hubs, when it does not yet know whether such hubs will be clean enough to qualify—reliably and over the long term—for the grant of funding. Charging ahead without that knowledge is putting the cart before the horse.

The federal Bipartisan Infrastructure Act of 2021, Section 40314, authorizes the DOE to invest billions of dollars to commercialize technologies that strengthen U.S. energy independence and cut carbon emissions. The statute allocates $8 billion for building regional clean hydrogen hubs. These hubs are not experimental pilot projects (funding for which is established in another section of the law), but rather infrastructure development projects to establish jobs-generating, hydrogen-based industrial centers. The program is designed to encourage hydrogen production not only from electrolysis of water, but also from chemical processing of methane from natural gas—if the carbon emissions can be captured efficiently enough to qualify the project as “clean.”

May 23, 2022

Arjun Flora and Ana Maria Jaller-Makarewicz IEEFA

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Key Findings

Elevated gas prices and a future tight market means blue hydrogen is no longer a low-cost solution.

IEEFA estimates that blue hydrogen costs published by the UK government last year are now 36% higher, calling into question continued policy support for development of the technology.