WASHINGTON - September 12, 2022 - (Investorideas.com Newswire) When Congress included $20 billion for low-carbon energy demonstration projects in last year's infrastructure bill, lawmakers sent a clear signal that the Energy Department's new Regional Hydrogen Hubs program (H2Hubs) should seek to create regional hydrogen economies that cut emissions, create jobs, and spur a robust national clean hydrogen sector. But the question is how to get there. A new report from the Information Technology and Innovation Foundation (ITIF), the leading think tank for science and technology policy, provides a roadmap.
With $8 billion allocated over five years, H2Hubs is the largest program in DOE's clean energy demonstration portfolio. ITIF's new report argues that to fund a successful hydrogen ecosystem as Congress intended, DOE should focus on the capital costs of building core hydrogen production plants and related infrastructure such as delivery systems, and it should generally eschew covering operating expenses or supporting end users.
"DOE is facing a strategic challenge," said Incumetrics, Inc. president Robin Gaster, who authored the report for ITIF. "On the one hand, the notice of intent it has issued appears to seek accountability and simplicity by focusing funding on the core plant. On the other, it has an obligation to fulfill the congressional mandate to help build a hydrogen-driven ecosystem. The way to resolve that challenge is to focus primarily on the former while also funding critical infrastructure improvements on a case-by-case basis. Beyond that, DOE should avoid using demonstration project funds to subsidize end users directly, and it shouldn't subsidize the ongoing operations of infrastructure providers."
In analyzing the strategic challenge DOE faces between funding core hydrogen plants versus multiproject ecosystem, the new report examines five elements that DOE could fund:
The analysis reaches the following conclusions:
"Under this hybrid model, DOE would seek hub proposals that explicitly allocate funding to both the core plant and regional infrastructure," said Gaster. "The core plant would need to meet the hard targets, while the residual funding elements could ensure that the hydrogen ecosystem as a whole is viable."
The Information Technology and Innovation Foundation (ITIF) is an independent, nonprofit, nonpartisan research and educational institute focusing on the intersection of technological innovation and public policy. Recognized by its peers in the think tank community as the global center of excellence for science and technology policy, ITIF's mission is to formulate and promote policy solutions that accelerate innovation and boost productivity to spur growth, opportunity, and progress. Learn more at itif.org
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