Two hydrogen hubs partially located in Pennsylvania will receive slices of $7 billion in federal funding, the Biden Administration announced Friday.
The proposed Appalachian Regional Clean Hydrogen Hub [ARCH2] is based primarily in West Virginia but will span parts of Western Pennsylvania. In Eastern Pennsylvania, the Mid-Atlantic Clean Hydrogen Hub, or MACH2, will also receive funding. The two projects are among seven nationally to be designated for funding from the U.S. Department of Energy.
A separate proposal centered on the Pittsburgh region, which had garnered support from local and state officials including Gov. Josh Shapiro, Allegheny County Executive Rich Fitzgerald and local labor and industry leaders, was not selected for funding by the White House, stirring disappointment among proponents.
The ARCH2 hydrogen hub, backed by the largest natural gas producer in the United States, Pittsburgh-based EQT Corp., will use fracked natural gas to produce hydrogen. The resulting carbon emissions from that process are to be captured and injected deep underground. The hub will center in West Virginia, but will also span parts of eastern Kentucky, Ohio and Southwestern Pennsylvania. The project is set to receive up to $925 million in federal funding.
Across the state, the MACH2 hydrogen hub will extend over parts of Pennsylvania, Delaware and southern New Jersey, and will use renewable and nuclear electricity to produce the element. The project is set to receive up to $750 million from the federal government.
The Biden Administration expects the seven hubs to catalyze an additional $43 billion in private investment, bringing the total to nearly $50 billion for “one of the largest investments in clean manufacturing ever.”
What is a hydrogen hub?
Hydrogen, nature’s simplest element, can be transported, stored and ultimately combusted with zero carbon footprint. But it takes energy to separate the hydrogen from other molecules.
Currently, 96% of global hydrogen production is powered by fossil fuels and is known as gray hydrogen. Hydrogen separated from water using electricity from renewable sources is known as green hydrogen. Blue hydrogen would be made with natural gas, and the resulting carbon emissions would be captured and buried deep underground through a process known as carbon capture and sequestration.
Hydrogen is a key component of the Biden administration’s goal to achieve net-zero emissions by 2050, but it is restricted to uses that are difficult to electrify, such as steel and cement production, heavy-duty transportation and shipping.
Pittsburgh left out?
Locally, business and labor organizations expressed disappointment with the decision to fund the West Virginia-based ARCH2 proposal over another hub that would have been based in the Pittsburgh Region, the Decarbonization Network of Appalachia [DNA], which was also among 33 finalists.
“While we are disappointed that the [Southwestern Pennsylvania]-based DNA project was not chosen, we’re pleased that the eastern side of the state has the potential to benefit from the jobs and investment associated with the MACH2 project,” said Jeff Nobers, executive director of Pittsburgh Works Together, a labor and industry organization, in a statement Friday morning.
“We will have a role in the WV-based ARCH2 project, and some jobs will be created here and in other areas of the state, but certainly not at the level we had hoped. It is critical that we work together to attract as many jobs and as much investment as possible from the ARCH2 project” into Southwestern Pennsylvania.
Joe Rockey, the Republican nominee for Allegheny County executive, called the Department of Energy decision “an example of what happens when local leaders don’t unite behind important projects.” In a statement, he accused Democratic nominee Sara Innamorato of opposing the energy industry.
Innamorato later issued a statement that ARCH2 “has the potential to benefit thousands of skilled union workers in Western Pennsylvania.” She said more federal funding is likely. “We will win our fair share.”
According to the Department of Energy, ARCH2 is projected to create more than 3,000 permanent jobs in addition to 18,000 construction jobs, some of which are likely to be spread across parts of Western Pennsylvania.
(Left) A screenshot from a Shale Insight presentation shows a projected distribution of jobs from the ARCH2 project. (Right) A screenshot from Shale Insight shows a projected distribution of hydrogen production from the ARCH2 project.
Demand for hydrogen?
At a town hall meeting in Moundsville, West Virginia, last month, EQT CEO Toby Rice acknowledged a fundamental issue with the hydrogen economy: “The biggest problem with hydrogen right now, there’s nobody that uses hydrogen,” he said. He added that hydrogen is a “classic chicken and the egg situation,” in that you need supply to fuel demand, and vice versa.
Another issue, he said, is cost.
“To use hydrogen pure is going to require completely new infrastructure,” he said. “Completely new pipelines, transportation networks. Guess what? That’s going to make it very costly.”
The carbon dioxide pipelines needed for carbon capture and sequestration in a Southwestern Pennsylvania hydrogen hub could cost $10 billion, according to a 2021 study by researchers from Carnegie Mellon University, Harvard and the Massachusetts Institute of Technology. Underground storage and other infrastructure would add to that price tag.
“Right now, there isn’t sufficient demand for either hydrogen or carbon capture to justify the construction of a bunch of pipelines for either carbon or hydrogen,” said Sean O’Leary, a senior researcher for energy and petrochemicals at the Ohio River Valley Institute.
O’Leary said the buildout of facilities that manufacture and consume hydrogen, along with carbon capture infrastructure, is “something that’s going to play out over time.”
The federal funding awarded, O’Leary said, “isn’t enough to even begin constructing the pipelines and other infrastructure that are necessary for this. It barely scratches the surface.”
Concern for health and environment
A consortium of 32 environmental and health advocacy organizations, meanwhile, expressed deep concerns with the decision to fund the Appalachian hub.
“Whether it’s the continued operation of fossil fuel power plants, the increased risk from new pipelines and underground storage of carbon, or locking in more toxic air and water pollution from shale gas development, the public will have to bear the significant health burden of this hydrogen hub” said Alison L. Steele, executive director of the Environmental Health Project, in a co-signed statement Friday morning. Steele pointed to recent studies by Pitt and the Pennsylvania Department of Health which found increased rates of cancer, asthma attacks and low birth weight among people living in close proximity to fracking.
“The commitment to continuing these harms just weeks after the findings of the Pennsylvania health study highlights just how deeply our leaders are failing Appalachian communities.”
The statement also pointed to research that questions blue hydrogen’s role as a climate solution.
“Hydrogen produced from natural gas perpetuates our reliance on fossil fuels and locks in our dependency on an unsustainable energy system,” said Shannon Smith, executive director of FracTracker Alliance in the joint statement. “Misrepresenting fossil-fuel derived hydrogen with carbon capture and storage technology as an effective transitional energy source fails to account for a wide array of adverse environmental and social impacts.”
Editor’s note: This article has been updated with additional comment on the Department of Energy’s decision.
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