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Leaders of the Appalachian Regional Clean Hydrogen Hub (ARCH2), one of seven hydrogen hubs around the country to win a share of $7 billion in federal funding, are now negotiating with the Department of Energy (DOE) on the specifics of its projects, hub panel members explained during the recent Washington County State of the Economy event.
ARCH2 is based in West Virginia but also includes partners across Pennsylvania and Ohio. It was selected by the DOE in October to receive up to $925 million in federal money to spur the development of the hub concept as a way to decarbonize the industrial and transportation sectors to meet climate goals.
The ARCH2 hub will involve about 14 individual projects focused on creating “blue” hydrogen using the region’s abundant natural gas from the Marcellus and Utica regions, with the resulting carbon dioxide emissions captured and sequestered deep underground in rock formations. The partners will be creating, transporting, storing, or using hydrogen in fuel cells, manufacturing and industrial processes, or electric generation. The concept is an “integrated hydrogen ecosystem,” said Melanie White, director of Allegheny Science and Technology.
Hydrogen is a clean energy source that when burned produces only water. However, it is expensive to produce, particularly if electrolyzed from water molecules. Blue hydrogen produced from natural gas is currently the lowest-cost method of production. The federal government’s goal is to spur research, development, and deployment and bring the cost down through the federal funding program.
Shawn Bennett, energy and resilience division manager of Battelle, explained that the hub partners include a variety of potential uses, with CO2 sequestration as close to production as possible. “Each one is a use case,” to prove that the technology will work, thereby spurring additional investment in the region, he said.
Bennett also explained that there are four phases of development and deployment for the hub under DOE regulations, and “each phase is a go or no-go” for further funding. He pointed out that while the DOE required a $1-to-$1 match from the businesses involved, the ARCH2 partners anticipate $4 billion to $5 billion in private investment to leverage $925 million in federal money.
Mike Starck, head of fuel cell initiatives at EQT, said the Pittsburgh-based gas producer plans to make low-carbon aviation fuel, but noted that there will be challenges ahead for the hub. The biggest will involve the federal and state permitting needed for pipelines and the unknowns surrounding emerging carbon sequestration technology. While some projects will be ready to move to operation within a year or two, others may take longer. Additional work must be done to better understand the geology of the Appalachian basin, find sequestration locations near production, establish state sequestration regulations, and better develop the technology.
Panelists also cautioned that because the hub will involve blue hydrogen there will be some opposition from groups who do not want fossil fuels used to make hydrogen, and that could also present a challenge.
Bennett said that leaders are hopeful the negotiations with DOE will be finalized soon and the goal is to roll out ARCH2 to the public in the summer. One of the first steps will involve
community engagement, said White, interacting with those in impacted communities to determine their desires and goals for the projects.