Joe Biden’s flagship hydrogen project faces increasing opposition

The future of one of the Biden Administration’s flagship projects, to derive electricity from hydrogen, is uncertain due to community opposition. This highlights the difficulty in implementing a technology that was once touted as a key component to the green transformation.

The Appalachian Regional Clean Hydrogen Hub, which spans the Marcellus Shale basin in West Virginia and Ohio, as well as Pennsylvania, will produce hydrogen by using gas and carbon capture primarily before mid-2030. The $6bn project is opposed by local communities and environmental groups due to its negative impact on the environment and its doubts about its commercial viability.

In a Letter sent last month, more than fifty local environmental groups asked the Department of Energy to suspend the ARCH2 negotiations until the project was clarified.

Tom Torres is the hydrogen campaign coordinator for the Ohio River Valley Institute and one of those who signed the letter.

Clean hydrogen is being hailed for its ability to green difficult-to-abate industries such as shipping and cement manufacturing. The abundance of cheap gas in America has made it a desirable destination for projects like ARCH2, which uses gas and carbon-capture, also known by the name blue hydrogen.

The roll-out of blue hydrogen, however, is controversial due to the fact that it produces emissions and relies upon carbon capture technology which has not yet been proven cost-effective at scale. Researchers at Stanford and Cornell conducted a study that found the carbon footprint of blue hydrogen was 20% greater compared to burning gas or coal.

Green groups say that blue hydrogen projects give fossil fuel companies a lifeline. Instead, funds should be allocated to green hydrogen which is produced by renewable sources.

Kat Finneran is a geography doctoral student from Findlay, Ohio. Marathon Petroleum’s headquarters are located in Findlay. She warned that the hydrogen hub will “prolong the fracking operation for decades”.

Finneran said that the process does not just prolong these practices, but also validates them and gives them a greenwash. He was speaking at a Department of Energy hearing in March, which had nearly 200 participants.

BloombergNEF, a consultancy, estimates that the US will become the largest producer of clean hydrogen in the world by 2030. Blue hydrogen is expected to make up over three quarters of the production. The remaining five percent will be green hydrogen produced using renewable electricity.

Shawn Bennett has defended ARCH2’s commercial viability and environmental credentials. Bennett is the project leader of ARCH2 as well as a former deputy assistant secretary in the Trump administration for oil and natural gas.

He claimed that the hub wouldn’t “cause [new] gas wells to be spudded”, and attributed the local pushback on the project to a “misunderstanding”. Bennett said that ARCH2 is in negotiations with DOE, and has not yet finalised the sites of its hydrogen facilities.

“Without funding, it’s extremely difficult.” . . Bennett said that he would “start making promises and committments to communities” after he testified in a Pennsylvania House hearing on 17 June on hydrogen hubs. Environmental groups and legislators raised concerns about blue hydrogen’s high carbon footprint.

A spokesperson for the Department of Energy said that clean hydrogen is “essential” for a strong, green energy economy. He also stated that hydrogen hubs will “help unlock the full potential of hydrogen as a versatile fuel”.

The Biden Administration has set the goal to produce 10mn metric tons of clean hydrogen per year by 2030. This is up from almost zero today, and equal in size to the “dirty hydrogen” industry that is derived fossil fuels, and produces significant emissions.

Other hydrogen projects have been affected by community opposition. CMG Cleantech, a France-based company, moved its $113mn renewable tech park in Osceola County (Florida) to a new site after locals reacted against its green hydrogen plans. The project was delayed by 8 months.

Analysts claim that funding and customers for hydrogen projects are difficult to find. BNEF estimates that only 6 percent of US projects had signed binding agreements.

Elina Teplinsky is a partner at Pillsbury Law. She said, “There’s an absolute lack of confidence that there will be real hydrogen markets with competitive prices.” Many companies are waiting to make serious investments before making any.

Lack of final rules on the controversial Inflation Reduction Act clean hydrogen production tax credits has also hindered the sector’s expansion.

All seven hydrogen hubs wrote a letter in February to Treasury, warning that “investments will not materialise fully” unless rules are “significantly rewritten”.