California receives $12.6 billion federal grant to expand hydrogen production

(The Center Square) - California received a $12.6 billion federal grant to expand its hydrogen production and distribution capacity as the first approved national hydrogen hub. California currently has only 55 hydrogen stations, with another 108 in development, suggesting the state’s hydrogen sector would need to dramatically scale in size to become useful for more commercial and consumer transportation.

The grant is part of the federal government’s Hydrogen Earth Shot Challenge, with aims to bring hydrogen prices down by 80% within a decade, from $5 per kilogram to $1 per kilogram. Because hydrogen can make use of existing natural gas infrastructure with minimal modifications, and can even be blended with natural gas, the technology is fairly compatible with existing transportation infrastructure and can thus be used before hydrogen-specific infrastructure comes fully online.

California is targeting its hydrogen deployment at more energy intensive industries that are more difficult to decarbonize, such as heavy duty transportation.

“We’re going to use clean, renewable hydrogen to power our ports and public transportation – getting people and goods where they need to go, just without the local air pollution,” said California Governor Gavin Newsom in a statement.

California’s federally-funded hub program will focus on rollouts in Los Angeles and the Bay Area, and extend to the Central Valley and Inland Empire regions. The state program, ARCHES, notes “California’s extensive renewables portfolio will be essential to power electrolyzers that make clean, renewable H2, decarbonize sectors that are hard to electrify directly, and develop long-duration energy storage solutions.”

With solar energy so abundant in California that daytime electricity wholesale prices go negative — that is, producers pay to offload excess power — the state’s extra energy could easily be harnessed to produce hydrogen from water.

“It is widely recognized that hydrogen must be a part of the energy technology portfolio as energy pivots from fossil fuel-based solutions, including power generation, transportation, and energy storage, said California Hydrogen Business Council CEO Katrina Fritz to The Center Square.

The two types of hydrogen vehicle technology — fuel cell electric vehicles and internal combustion — both are zero or low emission technologies. Fuel cells that use energy stored as hydrogen only produce water vapor, while hydrogen internal combustion engines emit a small amount of nitrogen oxide in addition to water.

Hydrogen fuel cell electric vehicles, which have been in commercial production for years, use far fewer resources to create than pure battery-electric vehicles, as energy is stored as hydrogen — the most abundant element in the universe. Hydrogen internal combustion engines, on the other hand, are still experimental but offer more efficiency in higher-intensity applications.