Our clean energy transition requires hydrogen - we must treat it fairly

The Hill, August 30, 2023
By Jack Brouwer, Opinion Contributor

A machine is operated at a facility for the Norwegian company Nel in Heroya, Norway, on April 20, 2023. Nel makes devices that take water and split it into hydrogen and oxygen, known as electrolyzers, as well as fueling stations. The company announced plans Wednesday, May 3, to build a massive new plant in Michigan as it works with General Motors to drive down the cost of hydrogen. (AP Photo/Trond R. Teigen)

While driving my Toyota Mirai on the Long Beach International Gateway Bridge, I admired the impressive logistics of the Los Angeles and Long Beach ports. However, I was dismayed by the diesel emissions despite the region's wealth and regulations. We urgently need technology to eliminate fossil fuel combustion greenhouse gas and pollutant emissions.

Congress came together to pass the bipartisan Inflation Reduction Act (IRA), which includes substantial investments in clean energy technologies. Notably, clean hydrogen received a production tax credit to empower its competition against polluting fossil fuels.

Why? Because people worldwide demand cleaner air and rapid reductions in greenhouse gas emissions. Hydrogen stands as a known clean energy source capable of enabling deep emissions cuts in the toughest-to-decarbonize sectors where direct electrification is ineffective. It can replace fossil fuels in petrochemical production and energy-intensive industries like heavy-duty shipping, freight operations, steel, ammonia and cement manufacturing.

Scaling up clean energy technologies, including clean hydrogen, is vital for achieving net-zero emissions. Clean hydrogen offers crucial energy conversion, storage and transport features essential for our economy. The U.S. Department of Energy predicts a rising demand for clean hydrogen, exceeding 2 million tons annually by 2030 and 20 million tons by 2050, to achieve zero emissions in all sectors. Rapidly scaling up clean hydrogen production is necessary to unlock deep decarbonization and de-pollution. Congress responded by enacting the clean hydrogen production tax credit.

Despite this reality, a major debate is underway regarding access to the credit, particularly whether to impose additional requirements and regulations. The "three pillars" proposal suggests enforcing additionality, hourly time matching, and regionality rules for clean hydrogen producers. These rules entail building new clean energy assets for hydrogen production, using clean power instantly for electrolyzer operation and producing hydrogen in close geographic proximity with a direct grid connection to the clean power source.

Yes, we must eventually deliver clean energy within the temporal and spatial constraints that are sought by these proposed requirements. However, to achieve a zero emissions future with all renewable and clean energy technologies functioning ideally, we need a realistic path forward. Implementing these suggested requirements now could undermine Congress' goals of scaling clean hydrogen production and economy-wide decarbonization.

Requiring additionality today would be misguided. It assumes that producing hydrogen through water electrolysis would make the grid dirtier without building more renewable power plants. However, it overlooks the many state and federal incentives and mandates rapidly greening the grid. There is an abundance of new renewable capacity being built, sometimes overwhelming transmission and distribution infrastructure, causing grid interconnection delays, negative electricity prices and curtailed renewable generation. Building clean hydrogen now can improve grid resilience and deliver renewable energy to sectors unable to use it otherwise. Forcing clean hydrogen plants to wait for electricity infrastructure to catch up would slow down these benefits unnecessarily.

To scale up clean hydrogen, we must avoid immediately imposing additionality and other constraints on the nascent industry. These requirements were never applied to previous emerging clean energy sectors. Similarly, hourly time matching and regionality rules would hinder clean hydrogen projects in the crucial early years, which we cannot afford.

Preventing the growth of the U.S. clean hydrogen industry could lead to its expansion overseas, sacrificing our strategic clean technology leadership and jeopardizing energy security. Moreover, it may cost tens of thousands of domestic jobs. The proposed rules could also increase greenhouse gas and pollutant emissions by discouraging clean hydrogen projects and incentivizing the continued use of fossil fuels like diesel and natural gas in heavy-duty industries, ports and freight corridors.

Congress recognized the urgency of nurturing the clean renewable hydrogen industry, and action is required now. Establishing infrastructure and supply chains takes time. Starting the green hydrogen industry now is essential to achieve zero emissions by mid-century, saving lives and enhancing the quality of life, especially near heavy industries and important logistical hubs like the one I experienced driving over that bridge.

Jack Brouwer is a professor of mechanical and aerospace engineering and director of the Clean Energy Institute (CEI) at the University of California, Irvine.

2000, University of California Irvine Combustion Laboratory (UCICL)
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