Hydrogen Economy Update

C-MACC Hydrogen Weekly Update 16

US Hydrogen Hubs – Some Good and Some Less So, But Policy Difference to Europe Most Interesting

• Weekly Theme: US Hydrogen Hubs
• News Update
• Projects Update
• Ammonia/Methanol Update
• Power Update
• Next Week: Pockets of Demand

Key Points

• Two things stand out to us from the announced hydrogen hubs in the US last week – the embrace of blue and green hydrogen and the likelihood that some of the hubs have better plans than others.
• With its RED III directive, Europe is effectively stepping back from carbon capture and storage – pushing industry down a narrow “green only” funnel which will likely ensure Red III’s failure.
• The proposed hubs in the US that surround existing hydrogen infrastructure – including both grey supply and current hydrogen demand – look less likely to lose money than those that are greenfield.
• Some hubs have limited visibility to both production and demand and face very high capital costs because of the power intermittency around which they are based. Some money will likely be wasted.
• Full access to 45V is necessary to make the math work in several cases, but in these cases getting the full 45V credit will be expensive from a power management perspective – but a good start for the US.