Utah’s bid with other states for federal hydrogen hub comes up short

Clean-energy hub could have brought millions to the state, but DOE chose seven others.

(Trent Nelson | The Salt Lake Tribune) Dominion Energy's regulator station in Delta on Thursday, Oct. 5, 2023. At the station an electrolyzer will use solar energy to split water into hydrogen and oxygen, meaning it is a pollution-free source of hydrogen fuel. The project was included in the four-state Western Interstate Hydrogen Hub proposal, but the proposal wasn't chosen for federal funding.

This story is part of The Salt Lake Tribune’s ongoing commitment to identify solutions to Utah’s biggest challenges through the work of the Innovation Lab.

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The U.S. Department of Energy has passed over Utah’s bid with four other states to become a billion-dollar federal hydrogen hub in favor of seven other bids from around the country.

DOE received 79 bids for the $7 billion hydrogen hub program, and the Western Interstate Hydrogen Hub (WISHH) from Utah, Colorado, Wyoming and New Mexico was one of 33 bidders that were encouraged to submit more detailed applications.

But DOE ultimately chose seven others, including two in the West. The California hub and the Pacific Northwest hub (which included Washington, Oregon and Montana) made the cut. The seven qualified for varying amounts between $750 million and $1.2 billion.

Utah’s effort was coordinated by the Utah Office of Energy Development. The office’s spokesperson, Tracy Rees, said OED Director Greg Todd was out of the office and unavailable for comment Friday.

The WISHH bid included two Utah projects seeking federal funding. One was an effort to make “renewable natural gas” from the wood waste created when forests are thinned. A company called Juniper Fuels heats the waste without burning it, capturing the methane that is produced. That methane is then used to produce hydrogen.

“We are disappointed not to be one of the final hubs selected but feel proud to make it right to the final round,” said Juniper Fuels founder Jimmy Seear, who said the work will continue without the federal funding. “Our projects are moving forward with speed and are building momentum here in the State of Utah.”

The other Utah project was Dominion Energy’s test of adding 5% hydrogen to its natural gas stream. Dominion, Utah’s largest gas provider, has been testing the blend with 1,800 customers in the Delta, Utah, area. The hydrogen hub money was going to be used to test the blend in larger pipes and higher pressures.

“While we are disappointed that WIH2 was not selected, Dominion Energy Utah will continue to explore innovations and projects that make sense for not only for the environment, but socially and economically for our customers,” Jorgan Hofeling, communications strategic adviser for Dominion, said in an email. “DEU anticipates pursing the development of hydrogen production and blending capabilities in the distribution system in the coming years. Our current focus is on the completion of our current phase, hydrogen blending in Delta.”

The hydrogen hubs are funded by the Bipartisan Infrastructure Act and are part of the Biden Administration’s aggressive efforts to move the country to cleaner energy sources and reduce greenhouse gases that are causing climate change. Hydrogen produces less greenhouse gases than fossil fuels when it is used to produce energy. But hydrogen does not occur naturally in large quantities and must be created.

Here are the seven winning hydrogen hub bids:

— Appalachian Hydrogen Hub (West Virginia, Ohio, Pennsylvania): This hub will produce hydrogen from natural gas while capturing the carbon dioxide produced in the process, which is called “blue” hydrogen.

— California Hydrogen Hub: This hub will produce hydrogen from renewable energy and biomass, and it will develop a plan for decarbonizing public transportation, heavy transportation and port operations using hydrogen.

— Gulf Coast Hydrogen Hub: Centered in Houston, this hub will develop large-scale hydrogen production using both natural gas and carbon capture and renewable sources.

— Heartland Hub (Minnesota, North Dakota, South Dakota): This hub will focus on decarbonizing the agricultural sector, including fertilizer production, and using hydrogen for electric generation and cold-climate space heating.

— Mid-Atlantic Hub (Pennsylvania, Delaware, New Jersey): This hub aims to repurpose historic oil infrastructure and produce hydrogen from renewable and nuclear sources.

— Midwest Hub (Illinois, Indiana, Michigan): This hub will focus on using hydrogen decarbonizing heavy industries, including steel and glass production and sustainable aviation fuel production.

— Pacific Northwest Hub (Washington, Oregon, Montana): This hub plans to produce hydrogen through renewable sources and work to reduce the cost of electrolysis, the process for splitting water molecules to produce hydrogen.