What's Next for U.S.-Made Green Hydrogen?What's Next for U.S.-Made Green Hydrogen?

Green hydrogen is gaining traction as industries seek cleaner alternatives to high-carbon grey hydrogen, but challenges like cost competitiveness, limited renewable energy supply, and evolving tax credit rules hinder its growth.

Arlene Karidis, Freelance writer

January 27, 2025

5 Min Read
green hydrogen
Fahroni / Alamy Stock Photo

Green hydrogen demand is projected to soar over the coming years as oil refineries, chemical makers, and others look for cleaner hydrogen than what they buy today. Now, newer emerging applications are further sparking interest. But when, and even if, supply for this cleaner alternative will catch up to demand is uncertain.

Today this nascent industry can’t compete price-wise with grey hydrogen, a high-carbon emitter made from natural gas that claims 95 percent of the hydrogen market share. But developers face another issue: it has to do with available resources.

For context, green hydrogen is made by splitting water molecules into hydrogen and oxygen using electricity, usually from solar or wind. Getting ahold of enough renewables at a price developers can afford has been tough as more mature clean-tech industries latch onto a good share of what’s out there.

Waste360 talked to early movers in this space about these and other roadblocks before them. Stakeholders at the forefront discuss new approaches to help scale, including leveraging waste as feedstock. They touch on Europe’s progress and its potential impact on the U.S. And they explain a new tax credit rule that’s stirring controversy in their world.

Energy attribute certificates (EACs) are helping offset domestic green hydrogen producers’ costs. But beginning in 2030 they will only get credits for products they make during hours when electricity is generated (rather than receive credits based on their overall annual renewable energy usage).

That means when no or limited renewables are available, producers must slow down, shut down, or forgo credits and spend more to keep running, explains Jacob Susman, CEO of Ambient Fuels, a green energy developer.

“We had an opportunity to really make the U.S. a dominant global force in green hydrogen. And we may still get there, but [with this credit rule] we've probably pushed it out, five, possibly as much as 10 years. We'll see who ends up actually getting to the top on manufacturing the electrolyzer equipment [to produce clean hydrogen],” he says.

Some developers are looking for ways around grid dependency.

Evolving innovations like methane pyrolysis and a technology that converts scrap aluminum and water into hydrogen gas and high-purity alumina are showing promise, says Roxana Bekemohammadi, founder and executive director U.S. Hydrogen Alliance.

“Technologies like these that use less electricity or alternative sources provide alternatives that can operate efficiently under varying electrical cost scenarios. They can not only help in managing increased electricity demand but in ensuring that hydrogen adoption is less vulnerable to fluctuations in electricity prices and availability,” she says.

Industry gurus expect overseas markets, especially in Europe, to propel U.S. projects, driven by policies abroad that are pumping up demand. The European Union both incentivizes and mandates hydrogen decarbonization, while the federal government in the States only leverages incentives to catalyze this work.

Last year (2024) Europe announced several new major projects.

“Without comparable drivers in the United States, we’re likely to see a significant share of early domestic projects exporting hydrogen to offtakers in countries with these mandates. Domestic demand may take longer to materialize and will need to come from voluntary corporate decarbonization goals,” Susman postulates.

Most hydrogen today supports oil refining, ammonia production for fertilizer, and manufacture of varied chemicals. But the push to decarbonize the global economy is slowly but surely bringing other applications forward. Among them are renewable fuels to power heavy- cargo transportation on land, in air, and sea. The alternative, electric batteries, can’t meet these sectors’ massive power needs. 

A few European companies who have turned their attention to heavy-duty transportation are targeting the waste industry. Seeming to lead the way are the REVIVE project and the HECTOR project, which have both engaged in multi-year pilots deploying fuel cells in trash trucks.

And New Way and Hyzon debuted North America's first hydrogen fuel cell-powered trash truck in May 2024 at Waste Expo in Las Vegas.

Also on the homefront, a handful of developers are exploring other ways they might work with the waste industry. They have begun making clean hydrogen from trash.

Ambient is aiming to develop transportation options by combining green hydrogen with biogenic CO2 (released when organic materials decompose or are burned). Susman is looking to landfills and the pulp and paper industry for feedstock.

“Whenever we can get these [materials] in large concentrations at the right price, and we are somewhere it makes sense to make green hydrogen, we can make things like jet fuel or shipping fuel,” Susman says.
“We have projects in development both on the Gulf Coast and in the Upper Midwest where we are intending to do just that,” he says.

Ways2H is going down a similar path, announcing late in 2024 a successful proof of concept demonstrating the production of .11 tons of carbon-negative hydrogen from one ton of municipal solid waste.

Hydrogen from waste requires minimal power. The main energy source comes from the waste itself.

“We are witnessing an increased number of stakeholders developing and deploying waste-to-hydrogen solutions, with companies in the U.S. and  Europe proposing solutions to the waste industry that offer an alternative to incineration and landfilling,” Way2H CEO Jean-Louis Kindler told Waste360 earlier.

In general, green hydrogen produced in the U.S. from clean electricity is  cost competitive with blue hydrogen produced from natural gas with carbon capture. So, both types are likely to play a role in helping heavy industries decarbonize.

George Touloupas, solar, energy storage, and green hydrogen expert at Clean Energy Associates, joins the interested but guarded opportunists.

Hydrogen is targeting a price of $2/kg to be cost competitive with natural gas, which he describes as “very ambitious.” Currently hydrogen production costs six times that of natural gas, he told attendees of a webinar hosted by pv magazine.

As far as clean hydrogen’s performance in vehicles today, EV efficiency is 77 percent while fuel cell efficiency is 42 percent due to losses during production.

Susman is hopeful, including about hydrogen’s future in the States.

“There are forward-thinking companies here who want to be part of the first wave and stay a step ahead of their competitors.

“We expect final investment decisions to be announced for major green hydrogen projects in the United States soon, with the earliest large-scale projects likely starting operations in the next two to three years.”

About the Author

Arlene Karidis

Freelance writer, Waste360

Arlene Karidis has 30 years’ cumulative experience reporting on health and environmental topics for B2B and consumer publications of a global, national and/or regional reach, including Waste360, Washington Post, The Atlantic, Huffington Post, Baltimore Sun and lifestyle and parenting magazines. In between her assignments, Arlene does yoga, Pilates, takes long walks, and works her body in other ways that won’t bang up her somewhat challenged knees; drinks wine;  hangs with her family and other good friends and on really slow weekends, entertains herself watching her cat get happy on catnip and play with new toys.

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