Biden, energy secretary to unveil $7 billion hydrogen hub projects

WASHINGTON — President Joe Biden and U.S. Energy Secretary Jennifer Granholm on Friday are expected to unveil the seven projects selected to split $7 billion in funding to create regional "clean" hydrogen production hubs across the U.S.

Biden and Granholm are slated to visit Pennsylvania later Friday to make the announcement at the Tioga Marine Terminal at the Philadelphia port, a key end user of hydrogen, senior administration officials told reporters during a call Thursday.

The funding — part of a larger $8 billion hydrogen hub program funded through 2021's Infrastructure Investment and Jobs Act — will be used to create networks that link hydrogen producers, infrastructure providers and customers across multiple industries, including transportation.

Administration officials on the call described the hubs as "broad clusters of public and private entities located in a particular geographic area that produce and consume hydrogen in close proximity through connected infrastructure like pipelines."

Of the 79 concept papers submitted to the Energy Department, seven hubs representing 16 states were selected. The sites are:

1. The Appalachian Hydrogen Hub, which includes parts of West Virginia, Ohio and Pennsylvania.

2. The California Hydrogen Hub, which includes parts of California.

3. The Gulf State Hydrogen Hub, which is centered in the Houston region.

4. The Heartland Hydrogen Hub, which includes parts of Minnesota, North Dakota and South Dakota.

5. The Mid-Atlantic Hydrogen Hub, which includes parts of Pennsylvania, Delaware and New Jersey.

6. The Midwest Hydrogen Hub, which includes parts of Illinois, Indiana and Michigan.

7. The Pacific Northwest Hydrogen Hub, which includes parts of Washington, Oregon and Montana.

The regional hubs are expected to spur more than $40 billion in private investment and create tens of thousands of jobs, bringing the total public and private investment to nearly $50 billion, the officials said.

Some of the hubs will use renewable energy feedstock, while others will rely on fossil fuels and nuclear power. Some will target specific industries, such as steel making, heavy-duty trucking and power generation.

Several of the hubs also will require project labor agreements for construction, the officials said.

Meetings are expected to start next week with regional stakeholders to share project details and engage with the communities.

Once in full operation, the seven hubs are expected to cut 25 million metric tons of carbon dioxide emissions from end uses each year — an amount roughly equivalent to the combined annual emissions of 5.5 million gasoline-powered vehicles, the officials said. The hubs also are a key strategy to achieve the Biden administration's goal of reaching net-zero emissions by 2050.

Fewer than 1 million metric tons of clean hydrogen are produced per year today in the U.S., according to the Energy Department. But the department has set a goal to produce 10 million metric tons of clean hydrogen annually by 2030.

The president will announce Friday that the seven hydrogen hubs will contribute more than 3 million metric tons of hydrogen per year, accounting for one-third of that goal.

Clean hydrogen can be produced from domestic energy resources such as solar, wind, nuclear, biomass or natural gas with carbon capture, the officials said.

A provision in the Inflation Reduction Act known as 45V extends a tax credit of as much as $3 per kilogram to eligible producers of hydrogen. The incentive is meant to bolster the production of green hydrogen, which is made using electrolyzers that split water molecules.

But what constitutes "green" is a controversial question, with environmentalists fearing the government could extend the tax credit to hydrogen production methods that increase carbon emissions and hydrogen producers arguing a strict interpretation could hamper supply and investment.

The U.S. Treasury Department is expected to determine the answer before the end of the year.