North America

2021 - The Year of Hydrogen in North America

North America

2021 - The Year of Hydrogen in North America

With more federal funding than ever, new advancements within technology and projects, and political support, 2021 was the year hydrogen took off in North America. Senior Commercial Adviser, Manja Meister, brings you the top three things, you need to know from the industry.

As we look back and reflect on 2021, one theme that has dominated the year is hydrogen, which has become an accelerating force in the energy transition and the renewable energy market. Policymakers are waking up to the potential of hydrogen, funding is awarded, projects are announced, and powerful alliances are forged. It is clear that the US has the potential to become the world's biggest hydrogen market catching up to the more advanced European market.

Funding, funding, and more funding

2021 was the year when hydrogen developments in the US received more federal funding than ever before. On July 7, the US Department of Energy (DOE) announced a $52.5 million funding to the hydrogen sector, and in October alone, over $34 million was put into hydrogen projects and research.

More specifically, the DOE's funding of the hydrogen sector will go into 31 different projects to advance next-generation clean hydrogen technologies and support the DOE's initiative Hydrogen Energy Earthshot aiming to reduce the cost of clean hydrogen by 80 percent within the next ten years.

This will be the first federal initiative in a series of nine Energy Earthshots, to accelerate breakthroughs in more affordable and reliable clean hydrogen solutions within the decade via funding development and R&D across the value chain; production, conversion, storage, transportation, and consumption. The amount of new funding will certainly shape the hydrogen market as it evolves and set the pace for commercialization.

projet and technology advancement leads to collaboration

With all this new funding and federal backing, more and more new hydrogen technologies and developments are on the horizon. From the development of a new hydrogen gigafactory in New York State to the development of new systems that combines fuel cell and battery storage, nuclear power to peaker plants, to a hydrogen fuel cell-powered ferry in San Francisco.

Such projects signify that the hydrogen industry in the US and North America is accelerating fast. Combined with the considerable amount of federal funding, it is clear that we will see plenty more new projects and technologies within the following years. Federal investments and initiatives, advancing technologies, and new projects prove that green hydrogen, in particular, is used as a de-carbonization solution to the industrial, chemical, and transportation sectors in the US and worldwide and already fostering international collaborations.

In November at COP26, the New York State Energy Research and Development Authority (NYSERDA) and the Danish Energy Agency signed an extension on their collaborative agreement to share knowledge and resources to develop new green hydrogen solutions, among others, to decarbonize New York. The agreement is not only a big step in reaching net-zero targets but also marks the potentials for Danish technology and the importance of Danish presence in the North American hydrogen sector.

Danish presence in North America was also noted by the Trade Council in North America in 2021 by establishing the Energy Transition Advisory earlier this year. Based in Houston, the Energy Transition Advisory offers Danish companies boots on the ground, market insight, professional sparring, partner search, and market entry strategy within the market of hydrogen.

BUILDING OPPORTUNITIES WITH BIDEN'S INFRASTRUCTURE BILL

In November, President Biden's infrastructure bill was signed into law. With the bill comes an enormous funding packet supporting the US' path to achieve net-zero emissions by 2050. In addition, a ten-year tax credit worth up to $3 per kilogram of clean hydrogen was proposed to reach the net-zero target, which means the cleaner the hydrogen produced, the higher the tax credit received by producers.

This could potentially make green hydrogen derived from renewable energy cheaper than competing solutions such as blue hydrogen. Furthermore, Biden's initiatives includes $8 billion budget for large-scale regional clean hydrogen hubs, $1 billion for clean hydrogen electrolysis research and development and a $500 million funding for clean hydrogen manufacturing and recycling.

Moreover, the infrastructure bill solidifies a hydrogen fuelled future for North America and puts the US on the international map of vital hydrogen markets in the world catching up to Europe. Biden's bill, along with the new funds in the hydrogen sector, provides significant opportunities for producers and businesses working with green hydrogen who wants to make their mark on the US accelerating hydrogen market.

what does 2022 hold for hydrogen?

If companies outside of North America want to enter the hydrogen market, now is the time to act. With years of experience with green energy solutions, Danish companies have the opportunity to share their knowledge and advanced technology with aspiring hydrogen projects across the Atlantic.

Moreover, during 2022 many of the newly funded US projects will take off. With that comes a potential for Danish companies within the supply chain of hydrogen production to collaborate on these projects and take part in the energy transition.

The Energy Transition Advisory will continue to monitor the latest policies and business developments within the sector. The advisory is a great partner for Danish companies looking to enter the North American market and is dedicated to creating commercial opportunities, strong partnerships, providing companies with a detailed insight of key stakeholders and business opportunities.