Plug Power, GM Win Federal Funds In $750 Million Push To Accelerate Clean Hydrogen

The Energy Department is doling out grants to dozens of companies and universities to aid electrolyzer and fuel cell production to expand use of the carbon-free fuel.

The Biden Administration is pushing ahead with efforts to make carbon-free hydrogen a cheaper and more widely used form of clean energy, dispersing $750 million of federal funds to help companies and universities including Plug Power, General Motors and Cummins scale up production of electrolyzers that make hydrogen and fuel cells that use it.

Plug Power, which hopes to be a leader in “green” hydrogen made from water and electricity, is the biggest single recipient, getting three separate grants totaling $88.9 million, followed by Norway's’ Nel, a maker of electrolyzers, which received $54.9 million for two U.S. projects. GM, startup Electric Hydrogen and major industrial firms including Bosch, Cummins and Germany’s Thyssenkrupp also received major grants. Funds from the program come from the Bipartisan Infrastructure Law.

“The projects announced today—funded by the President’s Investing in America agenda—will supercharge our progress and ensure our leadership in clean hydrogen will be felt across the nation for generations to come,” Energy Secretary Jennifer Granholm said in a statement.

Hydrogen has a long history as a potential clean energy game-changer, but run into technical challenges over the past two decades. It’s the universe’s most abundant element but not cheap to make from carbon-free sources and costly to compress, store and move. The U.S. already uses at least 10 million metric tons of the fuel annually, virtually all made by steaming it out of natural gas. That’s a highly carbon-intensive process, generating at least 8 kilograms of CO2 for every kilogram of hydrogen produced, according to energy researcher RMI. The federal program is working with companies to bring down the cost of making hydrogen in ways that generate little or no climate-warming emissions to get industrial users to switch from the dirty variety.

Projects getting funds could give the U.S. the ability to make 14 gigawatts of fuel cells per year, “enough to power 15% of medium- and heavy-duty trucks sold each year and 10 gigawatts of electrolyzers per year, enough to produce an additional 1.3 million tons of clean hydrogen per year,” the DOE said.

“We believe (the grants) will have a profound impact on Plug's industry-leading manufacturing capabilities in fuel cell and electrolyzer" stacks, Plug Power CEO Andy Marsh said by email. “Congress has enacted these policies and enabled these programs to advance hydrogen and fuel cells as vital components of the United States’ energy and climate strategy.”

The Biden Administration previously announced $7 billion of funding for seven hydrogen “hub” projects across the country, with a further $43 billion of private funding to scale up production of the fuel. In December it also unveiled tentative guidelines for a federal tax credit for clean hydrogen production that’s worth up to $3 per kilogram. Companies including Plug Power and Cummins have criticized the proposed rules, which favor the use of electricity from new renewable power installations, as overly strict.

Hydrogen is already used to power about 18,000 fuel cell cars in California — selling for $36 a kilogram — but most companies and analysts say it’s wiser to use it for heavy industrial applications, production of ammonia for fertilizer and for long-haul semis.

Source: Forbes‍