Texas Energy Companies Move Towards Hydrogen Fuel Production

March 28, 2024
An effort being made by energy companies in Texas to produce hydrogen fuel is gaining support from the federal government and criticism from environmental groups.

An effort being made by energy companies in Texas to produce hydrogen fuel is gaining support from the federal government and criticism from environmental groups, reports the Texas Tribune.

Hydrogen is typically found bonded with elements like carbon, which are stripped away and left behind, leaving negative effects on the climate. However, engineers are developing a way to source hydrogen that would avoid leaving behind carbon. The improved process would collect the carbon left behind, and either save it for reuse or inject it into the earth to be stored.

While Texas has recently asserted itself as a leader in hydrogen production, this process, called carbon capture, is not being utilized. In order to transition to implementing carbon capture, Texas energy companies would need to build pipelines to move the hydrogen and subterranean caverns to store it. Creating enough supply and maintaining low prices for consumers becomes more difficult under this process.

So, the federal government has allocated billions of dollars in tax credits to hasten the production of hydrogen from gas with carbon capture or water. This past October, nine projects in Houston received federal funding for regional hydrogen projects, which includes Chevron and ExxonMobil.

The Houston ‘hydrogen hubs’ are planning to produce over 1.8 million metric tons of hydrogen annually, with around 80% being sourced from natural gas. With the federal government’s recent tax incentives, they will help lower the cost of hydrogen fuel to become competitive with fossil fuels.

Some environmental groups, however, have criticized plans to source hydrogen from natural gas using carbon capture, arguing that it will only serve to bolster the oil and gas industry. 

Additionally, David Schlissel, the director of resource planning analysis for the Institute for Energy, Economics and Financial Analysis, said that the government is going by a faulty model for evaluating financial support for these hydrogen projects. He’s pointed out that potential leaks from hydrogen pipelines have not been considered, and that the technology for carbon capture is not yet advanced enough to accomplish what it claims.

“The distrust (of oil and gas companies) is not unwarranted, right? There’s
been some wrongs done,” said Chris Greig, senior research scientist with Princeton University’s Andlinger Center for Energy and the Environment. “But somehow we have to set that aside and find some sort of middle ground.”

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