The United States has the ambition to remain a pioneer in global energy innovation and a leader in the production and distribution of hydrogen. Road map to a US hydrogen economy is another key step after the Inflation Reduction Plan to achieve this goal.
According to the strategy, “hydrogen is at a turning point and will benefit from economies of scale through sector coupling”. It is crucial for reducing carbon dioxide emissions and can be used in many industries, transport, residential and commercial buildings, and in the energy system to increase the efficiency of renewable sources.
By deploying simultaneously across multiple sectors, infrastructure costs will be shared across applications, and technology developments in one can be applied to others. Sector coupling is the key factor that is to contribute to the success of the American hydrogen economy, which, according to estimates, by 2050 can meet 14% (2,468 TWh) of the final energy demand in the country.
Road map to a US hydrogen economy
The document provides an overview of the current state of the hydrogen industry, identifies the challenges facing further development, and outlines the key milestones to be achieved in the various phases of growth. It focuses on three issues:
- High-impact strategic applications
- Reducing the cost of clean hydrogen
- Construction of regional clean hydrogen centers
The first concerns the use of hydrogen in strategic areas such as the energy sector, the chemical industry and metallurgy, and transport. The second focuses on bringing the cost of clean hydrogen down to $1 per kilogram over the next decade. The latter aims to achieve commercially viable large-scale deployment of clean hydrogen for regional demand.
The main goals are to meet the demand for 10 million tons of clean hydrogen by 2030, 20 million tons by 2040, and 50 million tons by 2050.
Although at first glance it may seem that the goals are not as ambitious as those of the European Union, which assumes a demand for 20 million tons of renewable hydrogen as early as 2030. Half of this will be produced in its area, and half will be imported. However, taking into account the additional incentives, it seems that at the moment the United States has a much better chance of meeting the assumptions and convincing producers, including European ones, to invest overseas.
Of course, we are talking about the Inflation Reduction Act (IRA) announced last year, worth over $400 billion. The act provides several tax credits for clean hydrogen, including its production (PTC) of up to USD 3 per kilogram, and investments (ITC), including up to 40% of eligible costs for hydrogen storage devices (when meeting the relevant national content requirements), as well as discounts for vehicles powered by hydrogen fuel cells.
Learn more about IRA
Additional funding of $8 billion will be provided to the DOE to support the development of four to eight large-scale regional hydrogen centers.
Four key phases for the development of the hydrogen economy in the United States
Road map to the US hydrogen economy has been divided into four main phases in individual years:
- Immediate next steps (2020-2022),
- Early scaling (2023-2025),
- Diversification (2026-2030),
- Broad rollout (after 2030).
The first three years were focused on establishing robust decarbonization targets in more states and at the federal level. It was crucial to develop a regulatory framework, including grid stabilization mechanisms, in particular long-term energy storage using hydrogen. The goal was to achieve the installed capacity of electrolyzers (10-50 MW), develop hydrogen distribution networks in pioneer states, increase the number of FCEVs and refueling stations, and implement the first pilot projects in the field of energy storage.
You can learn about the activities initiated this year and planned from our infographic
growth across the nation
According to the plan, the implementation of these actions is intended to enable the US to achieve ambitious milestones:
- Early scaling: demand up to 12 mt of hydrogen, investments of USD 1 billion per year, over 50,000 new jobs;
- Diversification: demand for up to 13 mt of hydrogen, investments of USD 2 billion per year, over 100,000 new jobs;
- Large-scale deployment: demand up to 17 mt of hydrogen, investments of USD 8 billion per year, and more than 500,000 new jobs.
