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Biden Administration Awards $7 Billion for 7 Hydrogen Hubs Across the U.S.

The Biden administration announced plans on Friday to award up to $7 billion to create seven regional hubs around the country that will make and use hydrogen, a clean-burning fuel with the potential to power ships or factories without producing any planet-warming emissions.

Hydrogen is widely seen as a promising tool to fight climate change, as long as it can be produced without creating any greenhouse gases. But very little of this so-called clean hydrogen is used today. By awarding the grants, the Biden administration is trying to stand up an entire industry from scratch.

Dozens of regions competed for the money, which will be awarded to proposed hydrogen projects on the Gulf Coast (Texas and Louisiana) and in the Mid-Atlantic (Pennsylvania, Delaware and New Jersey), Appalachia (Pennsylvania, West Virginia and Ohio), the Midwest (Illinois, Indiana and Michigan), the Upper Midwest (Minnesota, North Dakota and South Dakota) and the Pacific Northwest (Washington, Oregon and Montana). A proposed hub in California will also receive funding.

President Biden and Energy Secretary Jennifer Granholm were expected to travel to the Port of Philadelphia on Friday to discuss the announcement.

The gusher of federal money also kicked off a furious competition among states. The Department of Energy initially received 79 proposals for hydrogen hubs from states across the country before selecting seven. The hubs typically consist of networks of businesses, labor groups, researchers and local governments that have pledged to work together to produce, transport and use clean hydrogen.

The Energy Department estimates that nearly two-thirds of the investments will eventually go toward hydrogen made by renewable electricity.

Not all of the $7 billion in funding will be spent at once. As a first step, the Energy Department will give awardees initial grants to create more detailed proposals for their hydrogen hubs. If the agency deems the projects viable, it will disburse more money over time — but that money is not guaranteed if any of the hubs prove unworkable.

“We’re still a long, long ways away from creating a large-scale hydrogen economy,” said Alex Kizer, a senior vice president at the Energy Futures Initiative, a Washington nonprofit organization. “Think of these hubs as laboratories of sorts to experiment with potential business models for hydrogen and to try to figure out some of the technological and infrastructure hurdles.”

One big debate over hydrogen involves its use. There is widespread agreement that hydrogen should be used as a clean fuel when there are few other low-emissions alternatives, such as when making fertilizer. But some researchers say it makes less sense to use hydrogen to create electricity or to fuel cars or heat homes when there are simpler, more efficient alternatives, like electric cars or heat pumps.

“I do worry that with all this money, there’s going to be an effort to force feed hydrogen into applications where it’s not all that effective at cutting emissions,” said Sean O’Leary, a researcher at the Ohio Valley River Institute who has criticized the Appalachian hub proposal.

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