US Energy Secretary launches call to slash green hydrogen costs by 80%

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Energy Secretary Jennifer Granholm has announced several financing packages to support the US’ clean energy transition. Image: Department of Energy

The US Department of Energy (DOE) aims to bring the cost of making clean hydrogen down 80% in 10 years as part of a wider call for new developments in the energy sector.

Energy Secretary Jennifer Granholm called the target “ambitious yet achievable” on Monday (7 June) as she launched the DOE’s Energy Earthshots scheme: an “all-hands-on-deck” call for R&D initiatives to speed up low-carbon energy deployment.

Granholm said the Earthshots, which calls for projects that address technological challenges and cut costs, will tackle “the toughest remaining barriers to quickly deploy emerging clean energy technologies at scale”. The first of these focuses on reducing the price of hydrogen production 80% to around US$1 per kg within the next decade, focusing on renewable, nuclear and thermal conversion. Analysis from IHS Markit suggests that electrolysis costs below US$2/kg would make green hydrogen competitive with traditional hydrogen. Seven power companies in Europe, including Iberdrola and ACWA, set up a coalition of their own last December to drive the cost of producing green hydrogen down below that benchmark by 2026.

“Clean hydrogen is a game changer,” Granholm said. “It will help decarbonize high-polluting heavy-duty and industrial sectors, while delivering good-paying clean energy jobs and realizing a net zero economy by 2050.”

Called the Hydrogen Shot, the initiative sets out a framework for developing a cost-effective clean hydrogen sector within the American Jobs Plan President Biden launched earlier this year. The US$2 trillion plan initially included several fiscal benefits for solar and energy storage developers. The additional framework will also fund demonstration projects for new low-carbon hydrogen systems.

“By achieving Hydrogen Shot’s 80% cost reduction goal, we can unlock a five-fold increase in demand by increasing clean hydrogen production from pathways such as renewables, nuclear, and thermal conversion,” the DOE said in a statement.

As part of the call for new developments, the DOE’s Hydrogen Program issued a Request for Information (RFI) on demonstrations that could reduce the cost of hydrogen power production, lower carbon emissions, create jobs and benefit disadvantaged communities. The sub-division is seeking feedback from industry players, investors, developers, academics, research laboratories and government agencies on potential demonstration projects and identifying regions in the US that would be ideal for setting up new hydrogen power systems. The DOE has set a deadline for responses of 5pm ET on 7 July.

The Earthshot scheme’s launch follows a string of initiatives Granholm has rolled out in recent months to meet Biden’s goal of decarbonising the American electricity grid by 2035 and halving greenhouse gas emissions by 2030. The DOE initially earmarked US$128 million for research and development projects that will create new solar technologies, from high-performance modules to trackers and other components, that can extend the life of a plant from 30 years to 50.

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