AN INSIDER TAKE ON THE APPALACHIAN HYDROGEN & CCUS CONFERENCE
Guest author Kelly Yagatich, Regional Campaign Manager with The Climate Reality Project, shares her takeaways from the recent Appalachian Hydrogen and Carbon Capture, Utilization, and Storage (CCUS) conference. The conference follows the Department of Energy’s (DOE) announcement for federal funding to develop hydrogen hubs across the United States. While the DOE has promoted hydrogen and carbon capture technology as a way to accelerate the transition to clean energy, extractive industries are eager to use this funding to prolong Appalachia’s dependence on fossil fuels and prevent investment in more effective climate solutions.
This is the second article in our series on hydrogen and carbon capture technology. Click here to read the first article, Does Hydrogen Have a Role in Our Energy Future?
On April 21st, 2022, oil and gas industry leaders gathered just south of Pittsburgh, PA for the Appalachian Hydrogen and Carbon Capture, Utilization, and Storage (CCUS) conference. I had the opportunity to sit in on this conference, which sought to give updates on projects happening in the region, give attendees an opportunity to network, and provide information on how to support the industry moving forward. The agenda of the conference included speakers from Shale Directories, Long Ridge Energy, Monolith Chemicals, Westinghouse, In2Market, Shell, Equinor, US Steel, Washington County, Wishguard, Navigator, the American Petroleum Institute (API), and Keystate to Zero. The room was filled with many of the same people and companies that have been pushing Appalachian petrochemical development for the past decade. At this event, however, fracking and plastic were not the central points of discussion; the focus was instead on the next frontier of Appalachian natural gas development: hydrogen and carbon capture.
Here are a few of my main takeaways:
There was a lot of talk about climate
While not every speaker and attendee seemed to agree on the severity of the climate crisis, most speakers acknowledged their company’s commitment to the planet. Multiple speakers addressed goals to reach net zero by 2050, and although science tells us that net zero by 2050 isn’t nearly ambitious enough to keep us below our global temperature rise targets, the repeated invocation of climate commitments signaled that many people in the room are feeling the increasing global pressure to address the impact of their industry’s emissions. At one point, an attendee asked a tongue and cheek question of Marcus Koblitz, the speaker from the American Petroleum Institute (API), about if anyone will actually care about climate after the next presidential election cycle. Despite chuckles from several members of the audience, Mr. Koblitz answered with a straight face, saying that there is increasing pressure globally for companies to lower their carbon output and that independent of American politics, industry needs to be focused on reducing emissions to stay competitive in the global market.
Most speakers, though, were not convinced that lower carbon emissions necessarily meant shifting away from fossil fuel extraction. Perry Babb, from Keystate to Zero, started off his presentation by saying that we aren’t in an energy transition but rather an emissions transition. His claim was that the industry will continue to burn as much carbon in 2050 as they do now, but the only difference will be the way that emissions are dealt with. Mr Babb was not alone in his assertion that carbon capture is the next frontier for the energy industry. Both Long Ridge Energy and Wishgard LLC spoke about the future potential for carbon storage on properties that they currently own in OH, and Navigator touted their Heartland Greenway project, an interstate CO2 pipeline proposed in the midwest, as exemplifying the future potential for carbon capture and storage technology. Despite all of the recent studies that have emerged citing a lack of evidence that carbon capture is effective and economical at scale (IEEFA), the room was full of optimism and enthusiasm for further development of this technology —mostly as it pertained to hydrogen generation.
We’re going to be hearing more about carbon intensity scores
Hydrogen is being marketed as the green fuel of the future. Over the past several years, there has been a lot of conversation around the potential for hydrogen to help reduce the environmental impact of hard to decarbonize industries. To date, hydrogen generation is often categorized by color. For example, green hydrogen is created through the electrolysis of water with renewable energy, gray hydrogen uses natural gas as feedstock, and blue hydrogen also uses natural gas as feedstock but includes carbon capture (National Grid). The industry’s plans for hydrogen generation in the Appalachian region almost entirely rely on blue hydrogen —for the obvious reason of the region’s abundant access to natural gas feedstock. Interestingly enough, though, several speakers at the conference independently mentioned a desire to move away from categorizing hydrogen generation by color to instead focus on the carbon intensity score of the process.
The carbon intensity score of a process is a calculation of the amount of energy generated from that process versus the amount of carbon that process releases into the atmosphere. I can see where the push for carbon intensity scores as opposed to color categorization would be advantageous for corporations who want to market their hydrogen as clean when it is actually being generated by fossil fuels. The speaker from Monolith Chemicals, Anna Wishart, was one of the speakers who mentioned the need to shift from color categorization to carbon intensity score. She presented on Monolith’s Olive Creek 1 facility located outside of Lincoln, NE which generates both hydrogen and carbon black using renewable electricity and natural gas as feedstock. While the hydrogen generated from this facility is not classified as green under the color designation, Ms. Wishart continually emphasized all of the ways that Monolith seeks to lower the carbon intensity score of their process, emphasizing the renewable electricity component of their model. Monolith is currently in the process of scouting for a site in West Virginia to expand their operations to the Appalachian region, where they almost certainly intend to use fracked gas as feedstock for their process.
The speaker from Long Ridge Energy, Vance Powers, also called for a shift from the designation of hydrogen by color. At the Long Ridge Energy Terminal in Hannibal, OH, they are experimenting with adding hydrogen into their combustion stream for energy generation. At the time of the conference, they had already run two successful tests and hoped to continue running these tests until they are able to create a combustion stream that continuously contains up to 50% hydrogen. An attendee asked if Long Ridge is classifying the hydrogen that they’re burning on-site—and the subsequent power they’re generating—as gray because of its generation from natural gas. Mr. Powers responded that Long Ridge views the energy as “clean” because the hydrogen is a bi-product from an existing industrial product and that it would be better to reference the carbon intensity score of the power generated as opposed to the color.
Reducing the industry’s carbon intensity score was a repeated theme throughout. From the possibility of introducing renewable electricity and biogas into production processes to lower their scores to a statement from John Hines of Shell about a potential future where products are created with labels on them that state the carbon intensity score it took to make them, there seemed to be an unspoken consensus among the speakers to steer clear of rigid categorizations between fossil fuel and non-fossil fuel processes.
I think that as hydrogen and carbon capture become more pervasive throughout natural gas producing regions like Appalachia, we will be hearing a lot more about hydrogen’s potential to green the energy sector without that hydrogen necessarily being green in its generation.
Federal funding is a main driving force behind the push for an Appalachian hydrogen hub
While economic and social pressure are clearly driving industry to shift their production towards greener-presenting ventures, the other key element of a regional push for hydrogen and CCUS infrastructure is industry’s anticipation of massive federal funding for projects in the region. As part of the Infrastructure Investment and Jobs Act that passed in November 2021, the Department of Energy (DOE) has promised up to $8 billion in federal funding for 4 hydrogen hubs across the United States (The National Law Review). Among the several criteria outlined in the bill, at least one of these hubs has to be located in a natural gas producing region of the country, and because of this stipulation, regional industry leaders are rushing to lay the groundwork for what they see as impending federal funds.
It was less than four years ago that the DOE announced plans for a different hub, the Appalachian petrochemical hub, which industry and elected officials described as a renaissance for the region. Yet the only major petrochemical project to break ground is the Shell ethane cracker, with many other proposals, such as the PTTG ethane cracker and a proposed $1.9 billion federal loan to fund the hub, have fallen through.
The conference’s main panel discussion was centered around the idea of an Appalachian hydrogen hub. Moderated by Michael Docherty of In2Market, the panel featured John Hines of Shell, Karen Matusic of Equinor, and Chris Masciantonio of US Steel. Shell, Equinor, and US Steel are all members of the Appalachian Hub Alliance, a newly formed industry collaboration aimed at funneling federal investment for hydrogen and CCUS infrastructure to Appalachia (Pittsburgh Post-Gazette). The panelists were beaming with optimism in anticipation of a regional hydrogen hub. They cited Appalachia’s existing oil and gas infrastructure as laying the groundwork for a continued buildout of transportation and storage networks in the region. Their role in the conference seemed to be to hype up the audience with hope for the future rather than present on existing projects, and they all succeeded in presenting a confident vision of a regional hydrogen hub as a collaboration between industry, elected officials, union leaders, and community partners. Each speaker independently mentioned the job growth potential associated with a massive federal investment in the region, and despite the challenges that they mentioned, like the lack of existing regulation for CO2 pipelines and the mostly untested nature of the region’s ability to develop CCUS at scale, they were certain that, with federal funding, their vision for the region’s future would become a reality.
The Appalachian Hub Alliance members aren’t the only ones who are preparing for growing regional investment in hydrogen and CCUS, though. In addition to speaking about Long Ridge’s efforts to add hydrogen to the combustion stream at their Hannibal, OH plant, Mr. Powers was not shy about advertising the amount of developable land that still exists on that site and all of the potential for on-site hydrogen generation and storage. At one point during his presentation, he stated that he thought their site would be a great location for a hydrogen hub, offering their location as a potential hydrogen incubator for the region. The implication, of course, was that this required the appropriate amount of funding.
Beyond Long Ridge, Wishgard’s Project AEIS also hinges on the assumption of continued regional investment in carbon capture and hydrogen infrastructure. Similarly, Perry Babb of Keystate to Zero spoke about how they shifted the entire plan for their Clinton County, PA facility based on new developments around hydrogen and CCUS. The proposed facility, which was initially slated only to produce urea fertilizer, is now in the process of redeveloping plans for blue hydrogen generation, fertilizer production, and on-site carbon storage (PennFuture). Industry is laying the groundwork for a regional hydrogen hub, and they are eager for federal investment to finance this development.
Pipelines are the industry’s biggest area of concern
During the panel discussion about the hydrogen hub, one attendee used the question and answer portion of the discussion to share his experience working for a union that helps to build pipelines. He expressed his concerns about activists opposing pipelines and called for more union leaders and industry supporters to attend public meetings and events in favor of pipeline development. A subtle theme throughout the conference was the pressure that activists have put on industry pipelines and the need, as industry wades into the new territory of CO2 pipelines, to control the narrative—especially as state legislatures and regulatory agencies begin developing laws and regulations to govern this infrastructure. Pipelines seem to be the part of the buildout that is most susceptible to pressure from community resistance, and there was a strong desire in the room to quell any doubts about the ability for these projects to be completed.
This was most evident in the presentation by David Giles of Navigator on the Heartland Greenway. While Giles seemed optimistic about the potential for the project, he also spent a lot of time talking about the importance of educating the public about the safety of the project, specifically in the wake of the CO2 pipeline rupture in Satartia, MS (Huffington Post), an incident that community members continually brought up at the public information meetings Navigator held in all 55 counties that the project touches. At the end of his presentation, Giles was asked about the lessons learned from this project, and he focused on the need to show people how this development will benefit them locally.
Beyond community opposition to pipelines, the fact remains that most states do not yet have laws on the books governing and regulating CO2 pipelines. Multiple speakers mentioned the need for industry to continue to advocate for laws and regulations that favor this development, specifically in PA, OH, and WV. Regulation is an area that could potentially slow development or create additional hurdles for the industry to tackle. All in all, community resistance and regulatory questions around pipelines seemed to be the biggest challenge that industry is currently facing with hydrogen and carbon capture.
The map below (Figure 1) shows major sources of greenhouse gases that could be targets for future carbon capture technology. It also shows potential routes that pipelines could take to transport the CO2 away from these sites.
Figure 1. This map shows major powerplants and industrial sites that the industry could target for carbon capture technology. It also shows potential carbon dioxide pipeline routes connecting those sites and existing hydrogen production facilities. Data Sources: EPA Greenhouse Gas Reporting Program, Labor Energy Partnership Report “Building to Net Zero” and EPA Envirofacts. Map made in March, 2022 using 2020 datasets.
The Take Away
As the hope of federal funding continues to loom over the region, I’m sure we will be hearing a lot more from industry about the potential benefits of hydrogen and CCUS infrastructure in Appalachia. It is clear, though, that the industry is hearing the voices of community members speaking out about the climate impacts and safety concerns of continued extraction and fossil fuel production in the region. We must learn from others in the movement and continue to make our concerns heard at the local, state, and federal level to ensure that our narrative does not get overtaken or greenwashed by the industry narrative.
References & Where to Learn More
- Read the first article in this series: Does Hydrogen Have a Role in Our Energy Future?
DATASETS USED IN THE MAP ABOVE
Name: Hydrogen Production Sites
Date: 2020 Dataset, retrieved March 2022
Source: US EPA, available for download here
Name: Potential CO2 Pipelines in Ohio, West Virginia, and Pennsylvania.
Date: Data from June 2021, digitized in March 2022
Source: Labor Energy Partnership Report “Building to Net Zero,” digitized by FracTracker Alliance. Shapefile can be downloaded here.
Name: Ohio, West Virginia, and Pennsylvania Sources of CO2 Emissions
Date: Obtained in March 2022, using a 2020 emission dataset.
Source: Facilities were obtained from the EPA’s FLIGHT dataset, which can be downloaded here. A shapefile of the selected sites, filtered and mapped by FracTracker Alliance can be downloaded here. Notes: This shapefile shows uses EPA FLIGHT data filtered to include powerplants that reported >500,000 metric tons of CO2 emissions and industrial sites that reported greater than >100,000 metric tons of CO2 in 2020. These sites reported could qualify for the 45q tax credit. This methodology was based of the report, An Atlas of Carbon and Hydrogen Hubs for United States Decarbonization. These are not the only sites in the region that could have future carbon capture technology.
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