[Senate Hearing 117-274]
[From the U.S. Government Publishing Office]
. S. Hrg. 117-274
OPPORTUNITIES AND CHALLENGES IN USING
CLEAN HYDROGEN IN THE TRANSPORTATION,
UTILITY, INDUSTRIAL, COMMERCIAL,
AND RESIDENTIAL SECTORS
=======================================================================
HEARING
BEFORE THE
COMMITTEE ON
ENERGY AND NATURAL RESOURCES
UNITED STATES SENATE
ONE HUNDRED SEVENTEENTH CONGRESS
SECOND SESSION
----------
FEBRUARY 10, 2022
----------
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Printed for the use of the
Committee on Energy and Natural Resources
OPPORTUNITIES AND CHALLENGES IN USING CLEAN HYDROGEN IN THE
TRANSPORTATION, UTILITY, INDUSTRIAL, COMMERCIAL, AND RESIDENTIAL
SECTORS
S. Hrg. 117-274
OPPORTUNITIES AND CHALLENGES IN USING
CLEAN HYDROGEN IN THE TRANSPORTATION,
UTILITY, INDUSTRIAL, COMMERCIAL,
AND RESIDENTIAL SECTORS
=======================================================================
HEARING
BEFORE THE
COMMITTEE ON
ENERGY AND NATURAL RESOURCES
UNITED STATES SENATE
ONE HUNDRED SEVENTEENTH CONGRESS
SECOND SESSION
__________
FEBRUARY 10, 2022
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
__________
Printed for the use of the
Committee on Energy and Natural Resources
Available via the World Wide Web: http://www.govinfo.gov
COMMITTEE ON ENERGY AND NATURAL RESOURCES
______
U.S. GOVERNMENT PUBLISHING OFFICE
47-752 WASHINGTON : 2024
JOE MANCHIN III, West Virginia, Chairman
RON WYDEN, Oregon JOHN BARRASSO, Wyoming
MARIA CANTWELL, Washington JAMES E. RISCH, Idaho
BERNARD SANDERS, Vermont MIKE LEE, Utah
MARTIN HEINRICH, New Mexico STEVE DAINES, Montana
MAZIE K. HIRONO, Hawaii LISA MURKOWSKI, Alaska
ANGUS S. KING, JR., Maine JOHN HOEVEN, North Dakota
CATHERINE CORTEZ MASTO, Nevada JAMES LANKFORD, Oklahoma
MARK KELLY, Arizona BILL CASSIDY, Louisiana
JOHN W. HICKENLOOPER, Colorado CINDY HYDE-SMITH, Mississippi
ROGER MARSHALL, Kansas
Renae Black, Staff Director
Sam E. Fowler, Chief Counsel
Armando Avila, Senior Professional Staff Member
Luke Bassett, Senior Professional Staff Member
Richard M. Russell, Republican Staff Director
Matthew H. Leggett, Republican Chief Counsel
Kate Farr, Republican Counsel
C O N T E N T S
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OPENING STATEMENTS
Page
Manchin III, Hon. Joe, Chairman and a U.S. Senator from West
Virginia....................................................... 1
Lankford, Hon. James, a U.S. Senator from Oklahoma............... 3
WITNESSES
Satyapal, Dr. Sunita, Director, Hydrogen and Fuel Cell
Technologies Office, Hydrogen Program Coordinator, U.S.
Department of Energy........................................... 5
Murrell, Dr. Glen Richard, Executive Director, Wyoming Energy
Authority...................................................... 16
Lewis, Jonathan, Senior Counsel and Director of Transportation
Decarbonization, Clean Air Task Force.......................... 23
Graff, Michael J., Chairman and Chief Executive Officer, American
Air Liquide Holdings, Inc...................................... 41
Hlavinka, Brian, Vice President, New Energy Ventures, Corporate
Strategic Development, Williams................................ 51
ALPHABETICAL LISTING AND APPENDIX MATERIAL SUBMITTED
(The) Chemours Company:
Letter for the Record........................................ 396
Columbia School of International and Public Affairs, Center on
Global Energy Policy:
Statement for the Record..................................... 399
ENGIE North America, Inc.:
Statement for the Record..................................... 462
Graff, Michael J.:
Opening Statement............................................ 41
Written Testimony............................................ 43
Responses to Questions for the Record........................ 386
Hlavinka, Brian:
Opening Statement............................................ 51
Written Testimony............................................ 53
Attachment to Written Testimony: Pipeline Research Council
Report entitled ``Emerging Fuels--Hydrogen: SOTA, Gap
Analysis, Future Project Roadmap........................... 58
Responses to Questions for the Record........................ 389
Lankford, Hon. James:
Opening Statement............................................ 3
Lewis, Jonathan:
Opening Statement............................................ 23
Written Testimony provided by Mike Fowler, Director, Advanced
Energy Technology Research, Clean Air Task Force........... 25
Responses to Questions for the Record........................ 382
Manchin III, Hon. Joe:
Opening Statement............................................ 1
Murkowski, Hon. Lisa:
Letter from the Governor of Alaska addressed to Energy
Secretary Granholm......................................... 317
Letter from the Governor of Alaska addressed to Chairman
Manchin with attached opportunity description.............. 319
Murrell, Dr. Glen Richard:
Opening Statement............................................ 16
Written Testimony............................................ 18
Responses to Questions for the Record........................ 378
Northern California Power Agency:
Statement for the Record..................................... 465
Satyapal, Dr. Sunita:
Opening Statement............................................ 5
Written Testimony............................................ 7
Responses to Questions for the Record........................ 358
Wabash Valley Resources LLC:
Letter for the Record........................................ 470
OPPORTUNITIES AND CHALLENGES IN
USING CLEAN HYDROGEN IN THE
TRANSPORTATION, UTILITY, INDUSTRIAL,
COMMERCIAL, AND RESIDENTIAL SECTORS
----------
THURSDAY, FEBRUARY 10, 2022
U.S. Senate,
Committee on Energy and Natural Resources,
Washington, DC.
The Committee met, pursuant to notice, at 10:04 a.m. in
Room SD-366, Dirksen Senate Office Building, Hon. Joe Manchin
III, Chairman of the Committee, presiding.
OPENING STATEMENT OF HON. JOE MANCHIN III,
U.S. SENATOR FROM WEST VIRGINIA
The Chairman. Before we kick off today's hearing, I want to
note that Senator Barrasso is not able to be with us today
since he is back home caring for his wife, Bobbi. I wish her a
speedy recovery. I think everybody is up to speed on the
seriousness of her illness, and our prayers are with Bobbi, the
entire Barrasso family, and we will make sure that we take care
of John's seat until he gets back. We have good people here.
Okay.
Today, the Energy and Natural Resources Committee will
discuss the growing opportunities for hydrogen in our clean
energy future. Clean hydrogen is a game-changing fuel that we
can produce right here at home from our abundant resources and
use to decarbonize different sectors of the economy while
supporting energy independence. So I am very excited for this
conversation today and to hear from our witnesses who are
experts in their fields. I want to thank all of you for being
here today.
This is a topic that has received a lot of attention from
Committee members from both sides of the aisle, and I know many
of you are interested in the opportunities for hydrogen in your
home states--for good reason. As I said, clean hydrogen is a
versatile fuel that has the potential to significantly
decarbonize many sectors of our economy, including the power,
transportation, and industrial sectors. We have made a lot of
progress decarbonizing the power sectors, but the
transportation and industrial sectors are much harder, and
clean hydrogen could be integral to getting at those parts of
our economy. Now, when I say clean, I am talking about all of
the energy feedstocks and technologies that can be used to
produce hydrogen, including fossil fuels, nuclear, and
renewable energy. With advancements in technologies like carbon
capture for fossil and electrolysis, using electricity, we can
ensure hydrogen is produced from all of these domestic sources
in the cleanest way possible with low or zero carbon emissions.
Our industrial sector uses energy-intensive processes that
today mostly rely on energy-intensive fossil fuels. But
hydrogen can also deliver the heat required for these processes
and has already been put to the test in refining and chemical
plants. And with industrial sources contributing about 23
percent of U.S. greenhouse gas emissions, clean hydrogen can
help companies tackle the challenges of addressing the thermal
and electrical energy needs while also serving as a potential
feedstock. I also believe that we must look for ways to clean
up our transportation sector in an efficient way, given that it
is responsible for the largest amount of greenhouse gas
emissions in this country. We should seriously be considering
the potential of hydrogen use in vehicles and other modes of
transport, like shipping and aviation. It is easy to see why
there is a lot of enthusiasm for hydrogen.
Clean hydrogen can be used to decarbonize our intense
energy sectors, promote domestic economic prosperity, and
maintain energy security. However, we have some challenges to
tackle in order to build a clean hydrogen economy. Producing
hydrogen without emissions is two to six times the cost of
current production methods. Also, retrofitting end-use
applications to use hydrogen as a feedstock for everything from
chemical plants to cars and trucks will take huge investments
from both the public and private sectors. This is the demand--
that we need to develop hydrogen markets that can sustain
themselves. The other big challenge is the safe and efficient
transport and storage of large volumes of hydrogen, given its
physical properties. There is a lot of promising work being
done in this space that will allow us to leverage our vast
natural gas pipeline network to transport hydrogen to market. I
know we will hear about some of these efforts today.
As with many emerging technologies, we need to invest in
the entire hydrogen value chain to bring down the cost and
overcome deployment barriers. That is why I made research,
development, and demonstration of these technologies a central
part of the Energy Infrastructure Act, which this Committee
reported with bipartisan support last year, and which was
subsequently included in the recently enacted Bipartisan
Infrastructure Law. In that bill, we fund $9.5 billion in
research, development, and demonstration of clean hydrogen, and
we tasked the Department of Energy to develop a national
strategy and a roadmap to get us to a clean hydrogen economy.
This includes $8 billion for hubs across the country to
accelerate hydrogen production from all energy sources and
facilitate its delivery and utilization across all sectors of
our economy. This is an all-of-the-above fuel that can be made
with whatever resource you have on hand. For example, we sit on
an ocean of gas in West Virginia, along with the growth of
renewables, and as of this week, the ban on nuclear power has
just been repealed in West Virginia. That is good news. We are
also in close proximity to hydrogen end-use applications,
including power plants and refineries. So we are well-
positioned for one of these hydrogen hubs, just like most of
our Committee caucuses on both sides of the aisle. I look
forward to seeing the Department of Energy (DOE) get the
hydrogen hub selection process underway.
We have to get moving. The bill also includes $1 billion
for research and development to bring down the cost of
electrolysis, allowing for cost-competitive hydrogen production
from electricity. We align with this investment to ensure the
Department of Energy has the resources needed to meet the goal
of driving down the cost of clean hydrogen by 80 percent within
the decade--80 percent. And we invested another $500 million in
the manufacturing and recycling program to ensure that we can
develop these technologies here and support the domestic supply
chains that are needed to advance a clean hydrogen economy.
More will need to be done in the future, but these investments
are a down payment to innovating--not eliminating--our way to a
cleaner climate. I look forward to hearing from our panel of
witnesses on these topics and how we can take advantage of this
exciting technology to power our future.
With that, I am going to turn to Senator Lankford for his
opening remarks.
OPENING STATEMENT OF HON. JAMES LANKFORD,
U.S. SENATOR FROM OKLAHOMA
Senator Lankford. Chairman Manchin, thank you and thanks
for holding this hearing as well. The future of hydrogen energy
is exceptionally important for us to be able to address here,
to be able to talk through it. I am honored to be able to sit
in for Ranking Member Barrasso and join you and our family
praying for Bobbi and for her quick recovery.
Hydrogen is one of the simplest and most commonly occurring
elements on earth. The reason we are here discussing it today
is that it burns cleanly, with the byproducts being heat and
water. Hydrogen has many potential uses. One of the most talked
about possible uses for hydrogen is in the transportation
sector, and as a power especially for heavy trucks. NASA has
been using hydrogen fuel since the 1950's to power rockets into
space. They were one of the first to use hydrogen fuel cells to
support electrical systems on spacecraft. It is time that we
learn from their experience and their applied lessons to solve
transportation and heavy-industry challenges here on earth.
Despite the promise of hydrogen, there are some challenges
on releasing its potential. Hydrogen has to be freed from
compounds it commonly occurs in, like water (H2O)
and methane (CH4,) to get it into a state where it
can be used as an energy source. The process to separate the
elements requires significant power itself. The process to
continue this process, whether we put it into a liquid form
requires a tremendous amount of power to be able to keep it
that cold. Hydrogen also does not produce as many BTUs as
methane does. But beyond production challenges, there are many
logistical questions that need to be answered as to the use of
this technology and how it grows. One such question is how to
best transport hydrogen from where it is produced to where it
will be used. Our existing natural gas pipeline network holds
promise for transporting and delivering hydrogen across the
country, and provides an incredible example of how we can
leverage existing infrastructure to meet future needs rather
than starting from scratch. The natural gas pipeline
infrastructure has developed over decades.
To have this kind of infrastructure available for future
hydrogen, we need to make investments now. Unfortunately,
investment in natural gas pipelines, all too frequently, is met
with opposition, despite natural gas playing a key role in
lowering emissions, and despite the critical roles pipelines
may play in empowering a broad adoption of low- and no-emission
hydrogen. There are efforts already underway to grapple with
how to best produce and deploy this resource of hydrogen. I am
particularly proud of my home State of Oklahoma's efforts to
grow the hydrogen industry. In the spirit of its long history
of being an energy leader and having a very diverse energy
economy, my state put together a task force to determine how it
can use its deep experience in the energy industry to pioneer
the hydrogen frontier. The report of the task force was
released last year, and outlined a roadmap for how we can
combine our existing resources, like abundant natural gas and
renewable power, with our energy expertise to grow the hydrogen
economy.
I am glad we have witnesses here today who are familiar
with this effort and I am always glad to be able to see some
Oklahomans here as well. Although there are states and regions
that have the building blocks for the hydrogen industry, its
growth and broad success is far from guaranteed. Government
policies--unfortunately sometimes unfairly or unintentionally--
prevent technologies that should be winners from floating to
the top. I am concerned that the conversation around green
versus blue hydrogen will pit technologies against each other
rather than working together to establish a robust hydrogen
marketplace. The simple truth right now is that 95 percent of
hydrogen produced in the United States is made from natural
gas. If our goal is to determine whether hydrogen is a viable
alternative to some of our existing energy technologies, we
cannot discount a method that could drive the need for--and
development of--other parts of the supply chain. We really need
an all-of-the-above approach to give this effort the best
chance of success, and I am hoping this is a topic we will
discuss today.
Finally, hydrogen provisions in last year's Infrastructure
Investment and Jobs Act, including the $8 billion to stand up
regional, clean, hydrogen hubs, have generated a lot of
interest in many states represented on this Committee. I look
forward to hearing how the Department of Energy plans to spend
this funding and how they define a hub. Always glad to see all
of you here. I am grateful for the time that you have spent
actually writing and preparing for this time period and doing
the research, and we look forward to the conversation.
The Chairman. Thank you, Senator Lankford.
I would like to turn to our panel of witnesses. We have
with us Dr. Sunita Satyapal, Director of the Hydrogen and Fuel
Cell Technologies Office and the Hydrogen Program Coordinator
at the U.S. Department of Energy.
Dr. Glen Murrell, Executive Director of the Wyoming Energy
Authority.
Mr. Jonathan Lewis, Senior Counsel and Director of
Transportation Decarbonization at the Clean Air Task Force.
Mr. Michael Graff, Chairman and CEO of American Air Liquide
Holdings.
And we have Mr. Brian Hlavinka, Vice President, New Energy
Ventures at Williams Companies.
I want to thank you all again for joining us today. Dr.
Satyapal, we will start with you.
STATEMENT OF DR. SUNITA SATYAPAL, DIRECTOR, HYDROGEN AND FUEL
CELL TECHNOLOGIES OFFICE, HYDROGEN PROGRAM COORDINATOR, U.S.
DEPARTMENT OF ENERGY
Dr. Satyapal. Thank you, Chairman Manchin and Senator
Lankford, Ranking Member, and members of the Committee, thank
you for the opportunity to testify today. My name is Sunita
Satyapal and I am the Director for the Hydrogen and Fuel Cell
Technologies Office at the U.S. Department of Energy, where I
direct research, development, demonstration, and deployment
activities on hydrogen and fuel cells. I also serve as the DOE
Hydrogen Program Coordinator for multiple offices across DOE,
involved in hydrogen, including renewables, fossil, nuclear,
basic science, and others. This is a historic time for hydrogen
and a unique opportunity for the United States. With 18 years
at DOE and previously in industry, dedicated to advancing
hydrogen and fuel cells, I am honored to serve the nation to
the best of my capacity to accelerate progress in hydrogen
technologies. Clean hydrogen is one part of a comprehensive
energy strategy to enable clean, secure, and equitable energy--
a future for all Americans. I have three points today.
First, the status and the opportunity. Hydrogen offers
versatility and flexibility, both in terms of production and
end use. You can make it from renewables, nuclear, fossil, and
with carbon capture and sequestration. You can store it as a
gas, a liquid, or a chemical carrier and use it to produce
electricity or as a fuel or a feedstock. It can reduce
emissions, especially for hard-to-decarbonize sectors, like
heavy-duty transportation and industry, such as producing
fertilizer and steel manufacturing. It can provide reliable
power and long-duration energy storage to enable resiliency and
a renewable grid. DOE funding enabled more than 1,100 U.S.
patents, over 30 commercial technologies, and more than 65 that
we think could be commercial in the next few years. Today,
there are thousands of commercial fuel cells in the market for
stationary power and transportation, and over 10 million tons
of hydrogen produced in the U.S., mostly for oil refining and
ammonia production. Analysis shows the potential for two to
four times more hydrogen demand in the 2040 timeframe, and we
continue to assess various scenarios, and industry has
projected the potential for 700,000 jobs in the U.S. by 2030
based on market success.
My second point is that despite progress, there are still
significant challenges, including cost as well as the lack of a
hydrogen infrastructure, the lack of manufacturing at scale, as
well as durability and reliability and supply chain issues. We
have about 1,600 miles of hydrogen pipeline, but we will need
significantly more. We have three geological caverns for
hydrogen storage, but that is insufficient for the scale of
hydrogen required. We had about 170 megawatts of electrolyzer
capacity as of June of last year, but Europe alone has a 40-
gigawatt target by 2030. We must reduce cost and ramp-up scale
of clean hydrogen production, delivery, storage, and use to
achieve the benefits of hydrogen.
Finally, third is how are we addressing these challenges?
We must remain laser-focused and accelerate progress. Last
June, Secretary Granholm launched the Hydrogen Energy
Earthshot, with a bold, ambitious goal of $1 for one kilogram
of clean hydrogen in one decade and 80 percent less than the
cost of renewable hydrogen today. Our strategy from research to
deployment will help to achieve that goal. So thanks to
Congress, the Bipartisan Infrastructure Law and sustained
annual appropriations, which includes $400 million in the
President's 2022 request, provide a tremendous opportunity for
the nation. This will accelerate manufacturing and rollout of
hydrogen technologies and enable a competitive, sustainable
market and ensure the United States is not just a technology
leader in hydrogen, but also a leader in its deployment and
use. Now, stakeholder engagement, collaboration, coordination,
and metrics for success are all key to ensure the most
effective, cohesive, and efficient implementation of our
programs.
I know there is a lot of interest in the hubs. So today, I
am pleased to share that we will soon release two requests for
information to solicit feedback on the hydrogen hubs as well as
the electrolyzer and clean hydrogen manufacturing and recycling
provisions.
Thank you for the opportunity to be here today and for your
interest in hydrogen. I look forward to working with you to
decarbonize our economy, while ensuring equitable access to
low-cost, reliable, and resilient clean energy. I look forward
to your questions.
[The prepared statement of Dr. Satyapal follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
The Chairman. Thank you, Doctor.
Now we will have Dr. Murrell.
STATEMENT OF DR. GLEN RICHARD MURRELL, EXECUTIVE DIRECTOR,
WYOMING ENERGY AUTHORITY
Dr. Murrell. Chairman Manchin, Senator Lankford, and
members of the Committee, thank you for the opportunity to
participate today on this important topic. My name is Dr. Glen
Murrell and I am the Executive Director of the Wyoming Energy
Authority. The Wyoming Energy Authority plays a key role in
strategically positioning the energy economy of Wyoming for the
future. It is one of our missions and mandates.
Chairman, in early 2021, Wyoming adopted an energy strategy
focused on moving the state toward an all-of-the-above, net-
zero economy. This strategic ambition is full of opportunities
and challenges. Opportunities, obviously, for our rich
renewable resources and our nation's nuclear industry in the
state. That is clearly a challenge for our hydrocarbon base--
which brings us, of course, to hydrogen. Regardless of the
feedstock used, hydrogen can be produced in a manner that it
can be either zero or low emissions in profile. That is
obviously very important for Wyoming to meet our goal and it is
clearly, obviously, important because the value associated by
society and decarbonizing energy reforms today.
Second, hydrogen is also extremely flexible and can be
transported and consumed in multiple fashions. We can use gas
pipelines, liquid pipelines, rail, and highway to move it and
it can be used as a residential and industrial heat power,
transportation fuel, or industrial feedstock. This flexibility
creates multiple opportunities for an energy economy, and in an
energy economy like Wyoming we are looking to go from natural
gas to hydrogen, utilizing existing pipelines to continue to
provide low emissions fuel to large population demand centers
where our markets are. We are also looking to use it to co-fire
existing thermal fleet and realize an immediate reduction in
emissions on our coal and natural gas-burning turbines. We are
also looking to the future and thinking about how to synthesize
net-zero fuels and petrochemicals, like coupling a hydrogen
system with a nascent CO2 management system as well.
We are also looking at how we can use it as an alternative
storage and transmission method for our renewable base. So it
is not just about hydrogen. It is not just about a gas. It is
truly a transformative opportunity for an entire energy sector.
Shifting gears a little to Wyoming, some analysis shows
that Wyoming has something in the order of 25 percent of the
nation's feedstock for hydrogen production, whether it's
material or energy based. We also have abundant infrastructure
through the I-80 corridor. We have pipelines, rail, highway,
transmission, and others. We are geographically very well
located to deliver hydrogen--clean hydrogen--into various
markets either in the Denver metropolitan area or further
afield up the West Coast. We also have significant
CO2 management infrastructure and we are one of only
two states with Class VI primacy. These characteristics
obviously position Wyoming well for hydrogen development and I
am very proud today to be able to have the privilege to work
with companies like Tall Grass Energy and Black Hills Energy on
co-firing turbines in the Cheyenne area. We are working with
North Shore Energy in Southwest Wyoming and with Jonah Energy
on synthetic natural gas. We are working with Anschutz Power
Company of Wyoming on renewable-based hydrogen and we're
working with my co-panelist here from Williams Companies on
their plans for hydrogen in the state as well. We're also
working with our neighboring states in recognizing a shared
vision and a clear potential for development of a hydrogen hub
and infrastructure in the region.
Bringing up hubs again, the 2021 Infrastructure Investment
and Jobs Act contains dozens of programs that are beneficial
for Wyoming and obviously the most pertinent one today is the
Clean Hydrogen Hub program. Given the previous characteristics
I just mentioned, it is clear that Wyoming should be considered
a good candidate for the location of one of these hubs and we
certainly intend to submit an application, likely in
partnership with our neighboring states. A successful
application would carry multiple benefits, not just in Wyoming,
but Wyoming is going to help preserve jobs and it is going to
create new higher-quality jobs with the added value opportunity
there. It's also going to benefit some of the service
companies--the small businesses in the state as well. The
benefits extend beyond our borders and look to our neighboring
states and even further afield to our geo-commodity markets
like California and elsewhere. It provides them an opportunity
to immediately recognize progress toward their own
decarbonization goals. There is even a potential export
opportunity there where Wyoming clean hydrogen could be
exported to countries in Asia and help them. There is also a
strategic opportunity through the establishment of critical
infrastructure through the I-80 corridor, creating,
essentially, a trans-continental hydrogen transportation system
linking east with west.
Mr. Chairman, in summary, any discussion around hydrogen,
be it in relation to hubs or not, should include Wyoming
because Wyoming is a microcosm of our energy industry overall.
We believe our practices and intent mirror that or reflect that
of the industry overall with respect to hydrogen. Furthermore,
any success of developing a hydrogen infrastructure in the
state will benefit not only Wyomingites and our neighboring
states, but potentially, literally millions of Americans across
the country.
Thank you, Mr. Chairman.
[The prepared statement of Dr. Murrell follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
The Chairman. Thank you, sir.
Now we will have Mr. Lewis.
STATEMENT OF JONATHAN LEWIS, SENIOR COUNSEL AND DIRECTOR OF
TRANSPORTATION DECARBONIZATION, CLEAN AIR TASK FORCE
Mr. Lewis. Good morning, Mr. Chairman, Senator Lankford,
and distinguished members of the Committee. My name is Jonathan
Lewis. I am Senior Counsel and Director of Transportation
Decarbonization at Clear Air Task Force (CATF). CATF is a
global, nonprofit organization working to safeguard against the
worst impacts of climate change by catalyzing the rapid
development and deployment of low-carbon energy and other
climate-protecting technologies. CATF has submitted written
testimony from Mike Fowler, our Director of Advanced Energy
Technology Research. Today, I will share CATF's thoughts on how
hydrogen can help meet the challenge of fully decarbonizing the
U.S. economy by mid-century--which sectors are likely to
require hydrogen to be decarbonized and what types of research,
development, demonstration, and deployment programs for
hydrogen will help the United States meet its ambitious climate
goals.
First, the climate challenge is vast and urgent. Achieving
net-zero emissions across the energy system within several
decades will require transitions in both energy production and
many varied end-use sectors. Much of that transition will occur
through electrification and vast expansion of renewable energy
resources. Electrification is essential to decarbonization,
however, it is not by itself sufficient. Today, 80 percent of
end-use energy is provided by fuel molecules. Some of those end
uses can be electrified, but not all of them, so we will need
zero-carbon fuels, like hydrogen. Hydrogen is a versatile
carbon-free energy carrier that can substitute for some
conventional fossil fuels. We already have considerable
industrial experience making and using hydrogen and we are
developing and innovating improved techniques for producing
very low carbon hydrogen.
In the United States, hydrogen provides an enormous
opportunity for decarbonization in certain sectors and could
contribute to reducing CO2 emissions by one billion
metric tons per year or more. Hydrogen could be essential in
decarbonizing heavy transportation, such as heavy-duty
trucking, marine shipping, and aviation. Hydrogen will also be
needed to decarbonize heavy industry, for example, combustion
of fuels for process heating and in iron making. Finally,
hydrogen might also have a role to play in the power sector as
a load balancer to help enable a renewables-heavy grid. Demand
for clean hydrogen is projected to grow globally due to net-
zero carbon goals and demand in the United States could be 10
quadrillion BTU or more by mid-century. To meet decarbonization
goals, that hydrogen will need to be clean.
Clean hydrogen can be produced in multiple ways, most
notably by electrolysis using zero-carbon electricity or by
methane reforming using natural gas with carbon capture.
Requirements for how clean this hydrogen must be will depend on
the context and should evolve over time. What we know now is
that hydrogen produced with natural gas must include a very
high level of carbon capture for reformers, and extremely low
methane loss rates for natural gas used in the production, as
well as low CO2 intensity of electricity used in
those production processes. Likewise, hydrogen produced with
electrolyzers needs to utilize electricity that is clean and
additional to existing and planned zero-carbon electricity
generation.
The road to decarbonization with hydrogen is not entirely
clear today. So it is important that we proceed with multiple
clean production pathways simultaneously. Federal R&D and
demonstration programs will play a key role in building scale,
industry learning, and seeding growth. Policies that support
deployment of clean hydrogen will also be essential. Developing
and commercializing the technologies needed for affordable and
clean hydrogen production, transportation, and use across
varied supply chains will require sustained and committed
financial support from the U.S. Government. And although RD&D
support is extremely useful, it will not likely be enough to
overcome cost and build-out challenges for hydrogen. To
maximize the hydrogen decarbonization opportunity, support for
broader clean hydrogen deployment will also be needed. This
support may take a variety of forms, with tax incentives for
hydrogen--a key tool currently under discussion in Congress.
Production tax incentives are especially important and can be
calibrated to provide greater support for cleaner hydrogen
production. With deployment we can expect clean hydrogen costs
to come down dramatically.
Clean Air Task Force looks forward to continued engagement
with this Committee on issues related to clean hydrogen. I look
forward to your questions. Thank you for your time today.
[The prepared statement of Mike Fowler of CATF follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
The Chairman. Thank you, sir.
Mr. Graff.
STATEMENT OF MICHAEL J. GRAFF, CHAIRMAN AND CHIEF EXECUTIVE
OFFICER, AMERICAN AIR LIQUIDE HOLDINGS, INC.
Mr. Graff. Chairman Manchin and members of the Committee,
on behalf of Air Liquide's more than 23,000 U.S. employees,
thank you for highlighting hydrogen's role in the energy
transition. Thank you also for the opportunity to testify
today. My name is Mike Graff and I am the Chairman and CEO of
American Air Liquide. We are a world leader in the production
and distribution of industrial gases, including hydrogen.
Air Liquide, a proud founding member of the Fuel Cell and
Hydrogen Energy Association, entered the hydrogen market over
60 years ago, leading industry efforts on investment, research,
and technology development. With more than $1 billion already
invested in hydrogen activities in the U.S. and more than $5
billion worldwide, Air Liquide is actively building the
hydrogen future. In fact, we have committed to an additional
investment of nearly $10 billion in low-carbon hydrogen by 2035
to more than triple sales of hydrogen and help substantially
curb emissions. Importantly, hydrogen can ensure that the U.S.
remains a leader in the energy economy of the future. By 2030,
the U.S. hydrogen economy could generate $140 billion per year
in revenue and support 700,000 local jobs. Globally, Air
Liquide operates in 78 countries and we see countries making
comparable and sometimes greater investments in hydrogen. I
hope that much of the nearly $10 billion mentioned will be
invested here in the U.S.
As I often say, hydrogen alone will not drive the clean
energy transition. But the energy transition will not happen
without hydrogen. It will take the concerted efforts of both
industry and government to help achieve the nation's goal of
net-zero emissions by 2050. For our part, the private sector is
ready to lead. The government's development of a flexible
policy portfolio that rewards outcomes, allows for market
growth, and drives innovation and private investment can help
ensure a self-sustaining market and rapid adoption at scale
while promoting smart climate policy. Programs like DOE's
Earthshot, which is focused on reducing the cost of clean
energy, illustrate the importance of the public-private
partnership. Additionally, rapid implementation of the hydrogen
hubs will help grow the ecosystems needed to develop the entire
hydrogen value chain at scale, galvanizing a national hydrogen
market. Proposed policies like the Hydrogen Infrastructure
Initiative and Clean Hydrogen Production Act will incentivize
the production and deployment of low-carbon hydrogen and help
create high-paying jobs and lower CO2 emissions
across many sectors.
Air Liquide is an active participant in all of these
government efforts, which are essential for catalyzing
hydrogen's role in the energy transition. As the policy
framework develops, we must ensure that the U.S. can lead in
hydrogen production. Hydrogen is versatile. This versatility
enables us to leverage our vast and varied natural resources
and develop the right combination of investment, production
pathways, and end uses to meet our nation's needs. For example,
Mr. Chairman, as you well know, in Appalachia, there is an
abundant supply of natural gas. We can produce hydrogen from
that supply, dramatically reducing transportation emissions
compared to gasoline or diesel. And Air Liquide's Cryocap, a
suite of carbon capture solutions, can further reduce
CO2 emissions by over 90 percent at a steam methane
reformer. Or, in a state like New Mexico, which as Senator
Heinrich knows, there is abundance of solar power, and that
abundant solar power and electrolysis can be used to create
low-carbon hydrogen. The same is true in regions with abundant
wind and hydropower. Air Liquide operates the world's largest
proton exchange membrane electrolyzer utilizing hydropower from
the Canadian side of Niagara Falls to produce and supply the
Northeast U.S. with low-carbon renewable hydrogen.
The government should consider all options for hydrogen
production to help reach the nation's net-zero climate goal. By
focusing on the outcome of hydrogen use, we can address the
carbon intensity of hydrogen and enable producers to provide a
robust supply of low-cost hydrogen while minimizing the
environmental impact. Hydrogen is also very versatile in all
its applications. For instance, in industrial applications,
like supplying the chemical industry in Senator Cassidy's
Louisiana, carbon capture, biogas, and hydrogen can be used to
reduce the carbon footprint of this hard-to-abate sector. As
renewable power grows throughout the nation, hydrogen can
address the intermittency issues of renewable power sources by
producing hydrogen from low-carbon power when grid supply
outpaces demand and then storing it for later use.
Transportation is another exciting application. In Nevada, as
Senator Cortez Masto knows, we will soon start up a $250
million hydrogen production facility that will use biogas to
supply the mobility market in California and provide fuel for
up to 40,000 fuel cell vehicles.
As I said in the beginning, hydrogen alone will not drive
the clean energy transition, but the energy transition will not
happen without hydrogen. Thank you, Mr. Chairman and members of
the Committee. I will be very happy to address any questions
you may have.
[The prepared statement of Mr. Graff follows:]
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The Chairman. Thank you, sir. I appreciate it.
Mr. Hlavinka.
STATEMENT OF BRIAN HLAVINKA, VICE PRESIDENT, NEW ENERGY
VENTURES, CORPORATE STRATEGIC DEVELOPMENT, WILLIAMS COMPANIES
Mr. Hlavinka. Chairman Manchin, Senator Lankford, and
distinguished members of this Committee, my name is Brian
Hlavinka. I am the Vice President of New Energy Ventures for
Williams Companies. I lead a team of business developers
focused on creating decarbonization solutions for the future. I
am also the Vice Chairman of the Clean Hydrogen Future
Coalition. We are a diverse industry group focused on an all-
of-the-above approach to the development of a clean hydrogen
economy.
I want to start by saying thank you very much for having
us. We believe at Williams that hydrogen is a very important
topic and one that--if we're serious about decarbonization, it
has to be top-of-mind. Williams is one of the nation's largest
natural gas infrastructure companies. Today, we deliver about
30 percent of the nation's natural gas on a daily basis. Over
the last century, we have built out an energy delivery platform
that really is second to none. And moving forward over the next
century, we expect to continue doing that. We also realize that
we can continue to improve our business. We can focus on
sustainability and we can look toward things like hydrogen that
can work toward decarbonization of the overall grid.
In 2020, Williams was the first North American midstream
company to make a climate commitment. We have set very specific
targeted goals that we plan to achieve to lower our emissions
footprint, but also enable our customers, many of whom are
facing the same decarbonization challenges, to do the same. We
have set near-term goals to reduce our footprint by 56 percent
by 2030, employing ``right here, right now'' strategies to
lower our footprint, but also have an eye toward a net-zero
ambition by 2050. And this is where we turn our focus to
hydrogen and other similar technologies. We believe hydrogen
has the ability to be scalable, to ultimately achieve real
changes when it comes to decarbonization. And we think that our
infrastructure at Williams plays a very important part in that
role. Senator Lankford mentioned the ability to utilize
existing infrastructure to move clean molecules from where they
are produced to where they are used. We think our natural gas
infrastructure is perfectly situated to provide such a
solution.
A cornerstone of my team's work is based on hydrogen. We
are looking at the entire value chain of hydrogen, not just
production, not just end use, but also how to cost-effectively
and efficiently move molecules to market. We believe that our
infrastructure will provide that solution. In the near term, we
can begin blending hydrogen at low percentages, and over time,
move that percentage up to really push toward higher and higher
decarbonization efforts. We are currently developing and
executing real projects along our existing footprint that
include states like Wyoming and Oklahoma. It includes
Appalachia, the Pacific Northwest, the Southeast, and Gulf
Coast regions. The breadth of our footprint really gives us the
ability to take multiple approaches to hydrogen, both on the
production side and the end-use side. We do believe that carbon
intensity is the important part here. We have to focus on not
just colors, but really on how to continue to lower the carbon
intensity of the hydrogen that we are producing and using. A
color-blind approach is very important. It is one of the key
cornerstones of the Clean Hydrogen Future Coalition.
We think we can do projects today--and we are doing
projects today--that can reduce emissions in the near term. But
we also know that to get to scale we are going to need help. We
are going to need new partnerships. We are going to need
industry. We are going to need academia. We are going to need
regulators. We are going to need the people in this room to put
together solutions for the future. That is why this hearing is
so important. We need help. The RD&D dollars that are available
are a great start. We believe other incentives are needed to
really kick-start the development of a clean hydrogen economy.
Williams is making a very big push toward a clean energy
future and hydrogen is a very important part of that. We
believe it provides scalability that no other options can
provide. Thank you again for the time today. I look forward to
the conversation and addressing your questions.
[The prepared statement of Mr. Hlavinka follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
The Chairman. Thank you very much.
I want to thank you all for your testimonies. Now we are
going to begin our questioning. I have been trying to gather
some information here, but I am more excited about this hearing
than I have been for many because I truly believe that we are
going down a path--if we do not correct ourselves on what we
can do in America to become a clean-climate society using all
the resources we have available to us--shame on us. And right
now, there is a movement on EVs. I have nothing against EVs,
except we do not produce any of the raw products or refine
anything that goes into them. This scares the bejesus out of me
because I am old enough to remember standing in line in 1974
waiting to buy gas. I do not want to stand in line waiting to
buy a battery.
So I am very much concerned about that. Let me tell you
what we have done and about the transformation that has gone on
for renewables. It has been unbelievable. Think about what we
have done with wind and solar in the last ten years. We see how
it has come down in cost and become so competitive, and I think
it is wonderful. We have big wind projects in West Virginia.
Solar has not been as much. We should be doing a lot more. Wind
generation cost has fallen 74 percent and utility-scale solar
has dropped 82 percent. LED light bulbs have dropped 95 percent
in cost. Congress invested just $9.5 billion in clean for
energy and for hydrogen. First time.
In the last ten years, we have given about $10 billion to
DOE for R&D for renewables such as wind and solar. In the last
ten years for hydrogen, we put $2 billion. Let me tell you what
has happened for credits. In the last 10 years, production tax
credits for wind and solar have been $25 to $30 billion.
Hydrogen? Zero production tax credits. We have got to get off
the dime and start doing something. If not, we are going to be
left behind and be totally, totally, subservient to China. I
believe we are putting ourselves in one hell of a mess.
So I want to thank you all. Dr. Satyapal, you are renowned
for your knowledge and your expertise. Tell me how we are able
to accelerate and advance to get up to speed. And do you think
we can do it in a decade? In one decade can we make the same
transformation that has been made in wind and solar in
hydrogen?
I am going to go to you next, Mr. Graff, because you are on
the front lines in the real world.
Dr. Satyapal. Thank you, Chairman Manchin, and again, thank
you for your tremendous support for hydrogen. I would say that
right now we are really positioned to accelerate progress
thanks again to the Bipartisan Infrastructure Law and that $9.5
billion. In addition to the continued, sustained annual
appropriations, I think we are exactly positioned to cover the
R&D, but need to very rapidly accelerate both manufacturing to
get to scale as well as deployment. So for instance, the hubs,
obviously, will really provide that launching point, but I
think it is to your question of, you know, are we going to be
able to catch up within those ten years? I think we really need
that very comprehensive approach. It is not just about the R&D
or the deployments--that holistic view. So we are definitely
very well versed in what is happening globally.
The Chairman. Can it be done in ten years? One decade?
Dr. Satyapal. Within ten years there is a lot of
opportunity if we get things right.
The Chairman. Mr. Graff.
Mr. Graff. Mr. Chairman, I think that there is already a
lot of effort and a lot of work that has been proven at scale
in industry. I think the private sector has the technologies,
the know-how, and we ourselves and others have already built at
scale, whether that is to utilize carbon capture and utilize
natural gas to produce hydrogen or electrolysis as well as the
carbon----
The Chairman. With blue we need carbon capture. With green
we need not.
Mr. Graff. So exactly.
The Chairman. Correct?
Mr. Graff. I think with the low carbon aspect, we have the
clear ability to take steam methane reformers utilizing natural
gas and utilizing technologies like our Cryocap to reduce the
total carbon emissions by more than 90 percent. And so you end
up with a very low-carbon source of hydrogen. We also are able
to produce the renewable sources of hydrogen as well.
So I think industry--I think the private sector is ready.
But it can't be done alone. I think there has to be a clear
role and a public-private partnership with the government to
have smart climate policy that incentivizes the need to build
the infrastructure to make this occur. And as I mentioned in my
opening remarks, we see a very clear path to--basically, within
ten years--get ourselves to a place where we have made a real
difference. And that real difference will not solve all of the
issues to get us to net neutral, which is the goal by 2050,
which is also our company's goal, but we have those
capabilities to really get off the ground within ten years.
The Chairman. The reason I am so excited is that my state
is about 90 to 93 percent dependent on coal-fired power. We
know the transition is happening and it has to happen. We
understand that. We have some of the cleanest power plants in
the country, some of the largest at 2,500 megawatts. Those are
big boys. And we produce an awful lot of the power for the East
Coast. So we are a net exporter of power. With that, we have
been blessed with an ocean of energy underneath our feet with
natural gas, including the Marcellus shale. We have the Utica
shale. We have the Rogersville shale that we haven't even
touched yet. There is so much going on, and we have the ability
for us to transform ourselves and be not just an energy hub,
but a mass producer on top of that. We have the industrial
experience from the history of the petrochemical plants. West
Virginia hosted the leading petrochemical plants producing
during World War II. That got us some of the nylon, which was
invented in West Virginia. You can go on and on and on--what we
have been able to do.
We need to transform those areas, whether it be Wyoming,
which is a big coal producer. Us, as the largest right now as
far as still being dependent on coal power, but those are where
your hubs can be to produce the energy. We have the pipeline
system, maybe we can at least get our environmental friends to
help us build a pipeline that will carry clean hydrogen. They
are stopping everything we have. Now we cannot get a product
out to the market. We need that help, but what I am saying is
this is so vital. I think I am fine and willing to go down a
two-path system. EV is fine, to a certain extent, but we have
to make sure that we understand that we cannot get Thacker
Pass. That's not going to happen, I do not think.
Senator Cortez Masto. There are two lithium----
The Chairman. But I am just saying, enough to produce what
we are----
Senator Cortez Masto. But that's the goal----
The Chairman. Right, but with that, the refining of it and
the processing of it. I do not see any of that in America. I do
not see any of that happening soon in America. That is the
problem. So with being as dependent as we are, that is what my
concerns are.
I have taken more than enough time and I will turn it over
to Senator Lankford.
Senator Lankford. Well, I am going to go ahead and defer my
questions to the very end so we can get some of the folks that
are here on the panel. I am going to be here the whole time and
some of these folks are going to come in and out.
The Chairman. If that is the case, then we will go right to
Senator Cassidy, by WebEx.
Senator Cassidy. Thank you and thank you for your
graciousness, Senator Lankford.
You know, the interesting thing is it appears that we have
bipartisan agreement that hydrogen hubs are something that can
point us toward a lower carbon future. Ms. Satyapal, I
apologize because I am going to ask you about something which
in one sense you cannot answer, but I think I can express my
frustration.
Our witness from Wyoming spoke about how they are one of
two states with primacy in terms of permitting for CCUS, and he
spoke to that as a facilitator of development that will lower
our carbon footprint as we continue to power in a modern
economy. Now, I guess my plea, if you will--Louisiana has an
application to permit and site carbon capture sequestration
wells. They have primacy. By the way, I think we have 26
geologists on the staff of our Department of Natural Resources,
and Region VI has six for the entire region. It has been
complete since October, and EPA has told the state they require
no further edits to the application. But instead of accepting
the application and forwarding it to the EPA here in
Washington, Region VI has sat on it. They will not forward it.
They will not say, ``oh, we need these edits.'' They just sit
on it.
And so instead of facilitating the development of these
CCUS projects, which is bipartisan common ground, it is sitting
on an application and we do not know why. And I know that this
puts you in a difficult position, but do you think it is right
that Region VI should be sitting on this application and not
forwarding it?
Dr. Satyapal. Thank you, Senator Cassidy. And first of all,
thanks for your interest in hydrogen. We had your participation
in the Hydrogen Shot summits as well. And so we are committed
and I will take the action to go back to DOE and see what we
can do to expedite--understand what the situation is regarding
the permit. Thank you.
Senator Cassidy. Thank you, I appreciate that because we
want to move forward on this and we have an industrial corridor
that can benefit from it. As long as it is held up in a
bureaucratic kind of, ``We are not going to move it and we are
not going to tell you why,'' it is kind of the worst example of
government not at work.
Mr. Hlavinka or Mr. Graff--let me start with Mr. Graff.
Mr. Graff, 45Q--what is its importance in terms of
facilitating these projects for blue hydrogen or for otherwise
sequestering products and what do you think about proposals to
increase that? I am kind of begging an answer, but please give
your perspective.
Mr. Graff. Senator, thanks for the question. Clearly, 45Q
is one of the policies, one of the laws that will help
incentivize carbon capture and incentivize the use of natural
gas in hydrogen production. There are a lot of estimates. I
believe the National Petroleum Council had issued a report
about two years ago. We were a part of that development, where
it talked about incentives in order to go ahead and drive, at
scale, and also to drive the conversion of up to 25 percent of
all heavy industrial capacity to a low-carbon state. And 45Q
today provides roughly $50 per ton. I think that study
suggested to get to $90 was where you needed to be to drive the
real investments at scale and $110 to really begin to
decarbonize at least 25 percent of the industrial
infrastructure.
But I don't think that it is 45Q alone. I think the Clean
Hydrogen Production Act, which is under consideration today, is
another big piece of what we can do. And if we can put these
together, we can fully utilize natural gas resources. We can
provide and produce hydrogen of low carbon content and preserve
natural gas liquids and the production of those liquids for the
chemical sector.
Senator Cassidy. Mr. Lewis, let me ask. One of the issues,
and I understand that if we push, if we transport hydrogen by
pipeline, it is much more efficient than putting it in
pressurized tanks. It is less energy intensive. But there has
been a problem getting the Federal Energy Regulatory Commission
(FERC) to approve pipelines. Another example of ``We have met
the enemy and he is the Federal Government.'' What is the
importance of regulatory certainty in terms of permitting these
pipelines that would then allow the promise of a decarbonized
or relatively decarbonized future using hydrogen as a means to
relatively decarbonize?
Mr. Lewis. Thank you for your question, Senator Cassidy. It
is a great question. Regulatory certainty is clearly important
for many of the industries and other stakeholders in this
sector to make the major investments that we are going to need
to make to achieve the objectives that Chairman Manchin
mentioned for over the next decade. With respect to pipelines,
there is a lot of work that needs to be done to understand the
extent to which existing pipelines--natural gas pipelines,
existing natural gas rights-of-way--might be used to move
hydrogen. We hope that using that existing infrastructure is
possible, but we are closely watching that space to see what
can be done safely and what can be done efficiently.
Senator Cassidy. So Mr. Chairman, I just want to end. Thank
you for your graciousness, Senator Lankford, and just to say, I
began and I ended with the fact that the executive branch is
putting brakes upon the desire of the private sector to build
out to a lower carbon future. And so for an Administration that
claims they want a lower carbon future, they could begin by
giving the regulatory certainty and facilitating the states
doing their own facilitation to make that promise real.
Thank you. I yield.
The Chairman. Thank you, Senator.
Senator Heinrich.
Senator Heinrich. Thank you, Chairman.
I want to keep things brief because I have a long list of
questions I would love to get to, but for any of you, what can
we do to bring down the costs of electrolysis faster and
further, or further and faster, I should say?
Go ahead, Doctor.
Dr. Satyapal. Thank you so much, Senator. We have already
launched the H2NEW consortium with our national labs. Today we
are at about $1,000 to $1,500 per kilowatt. We need to be about
ten times less. And so we have already mobilized our resources,
and with Hydrogen Shot, we really have a good shot at getting
there within a decade.
Senator Heinrich. Do you have any opinions on the future of
the direction of electrolysis--proton exchange membranes (PEMs)
versus alkaline water electrolysis?
Dr. Satyapal. Yes, and we believe that we need the
portfolio. So some of the conventional alkaline will be able to
be deployed right away. We still need to reduce cost with PEM
and then we have even more advanced electrolysis like high
temperature. So we have the entire portfolio.
Senator Heinrich. Great. Super.
Mr. Lewis, Bloomberg New Energy Finance projects that
hydrogen from electrolysis is going to be cheaper than hydrogen
with carbon capture and sequestration by around 2030. If that
is even remotely accurate, talk to me about whether hydrogen
with carbon capture and sequestration projects risk being
stranded assets.
Mr. Lewis. We need a lot of clean hydrogen quickly. We need
it to be cost competitive, and taking that hydrogen from any
one particular energy source is going to be very difficult. So
we think we need to deploy all the clean energy resources we
can to produce hydrogen that has sufficiently low carbon
intensity. Our expectation is that hydrogen made from natural
gas with carbon capture sequestration is significantly cheaper
than green electrolytic processes right now. We are going to
see improvements on both of those, probably steep improvements
on the electrolytic side, but we think that in order to really
take advantage of the benefits that hydrogen can provide to the
decarbonization effort, we need as much of it as possible. We
are going to need more----
Senator Heinrich. What I am getting at is if you do it big,
not a distributive project, and electrolysis is small and
distributed and iterative, whereas, if you do a big, expensive
project that requires carbon capture and sequestration, you
really need 20 or 30 years to make that money back. So Mr.
Hlavinka, do you have thoughts about that--how we avoid, in the
interest of doing things in steps--how do we avoid making long-
term investments that end up being non cost-effective in just a
few years?
Mr. Hlavinka. Sure, thank you for the question, Senator.
We believe that the ability to quickly scale the production
of hydrogen does lean toward SMRs with CCUS. And so this is
really where we also think the ability to locate those next to
existing sequestration sites and next to existing
infrastructure is incredibly important to alleviate some of
those costs that would be required for new build-out of
infrastructure. And so the report you referenced around the
development of green hydrogen and electrolysis and bringing
that cost down over the next ten years, we think that is very
aggressive and we think that there is near-term opportunity to
produce large amounts of clean hydrogen without the use of
electrolysis.
Senator Heinrich. Dr. Satyapal, given the issues we
struggle with, including in my state in great degree with
fugitive methane in the natural gas supply chain, how do we
measure the carbon intensity of technologies like steam methane
reform with CCS to accurately reflect the entire carbon
intensity? So not just the reductions that we have heard about
today, but you have to account for upstream emissions as well.
Dr. Satyapal. Thank you, Senator and we are definitely
cognizant of the upstream emissions issue and committed to
reducing that. Right now, we have significant analysis underway
and we look forward to working on the clean hydrogen standard,
which is in the Bipartisan Infrastructure Law, but upstream
emissions is obviously a significant issue. Our focus is clean
hydrogen.
Senator Heinrich. So one of the things we have not talked
about today is the debate about where best to deploy hydrogen,
and to some degree the market will decide that. I am curious of
your thoughts on, you know, ten years from now are we going to
see hydrogen primarily as a solution to the decarbonization of
these hard sectors--heavy shipping, heavy trucking,
industrial--or as a storage medium for electric generation, or
both?
Any of you. Mr. Graff.
Mr. Graff. Senator, I think there are a couple key points
to be made. First of all, I would say in terms of the sectors,
I believe in ten years you will see the benefits of hydrogen,
first of all in transportation. There is already an element for
light-duty vehicles, but I think the real benefit is going to
be for commercial vehicles, heavy-duty vehicles, return-to-
base-type operations, warehouse-type facilities as well as the
Class-A tractor trailer that is on the road. The utilization of
hydrogen fuel cells and utilizing storage of hydrogen on board
takes minimal space and much less weight than a full battery
array to accomplish the same goal. So you preserve the payload,
you preserve the ability to manage that, and recognize that the
usability of hydrogen is very similar to what you have today.
For a passenger vehicle, you pull into your refueling station
and five minutes later you are on your way to drive another
300, 400, 500 miles, whatever the case may be for your vehicle.
There is not a long-term charging aspect to that. And you have
something even better----
Senator Heinrich. Yes, I'll give you that, but the reality
is we do not have the infrastructure anywhere today and all of
us have a plug in our homes. So it is not really inconvenient
for me to plug in my electric vehicle.
Mr. Graff. I think if we----
Senator Heinrich. It is a different situation with tractor
trailers, obviously.
Mr. Graff. Fair. I believe though, if you think about
commercial vehicles and we think about the heavy duty and
return-to-base operations, and you begin to go ahead and set up
significant infrastructure to meet those needs, then I believe
it is a real solution.
Senator Heinrich. Great.
Mr. Graff. I think also for industry, you will see it in
chemicals and you will see it in steel over that time. And for
the grid, definitely for backup for solar and for wind. We have
already built the world's largest hydrogen storage facility in
Beaumont, Texas and it contains enough hydrogen energy to go
ahead and back up a new, full-scale nuclear power plant for one
to two weeks, if you built out the infrastructure. So I think
there is a lot of capability.
Senator Heinrich. Thank you, Mr. Graff. And I apologize,
Chairman, for running over for a couple minutes here. I
appreciate----
The Chairman. It is extremely important, very important.
Thank you.
And now we have, by WebEx, Senator Hoeven. Early. God bless
you.
Senator Hoeven. Thank you, Mr. Chairman, I appreciate you
holding the hearing.
Let me start with Dr. Murrell. You know, Wyoming and North
Dakota are two states that have both the state and EPA
regulatory approval in place to actually store CO2
through carbon capture and sequestration as well as the geology
to do it. And so my question to you is, what do you think has
to happen for us to take our coal-fired electric plants and
capture that CO2 and then either continue to produce
electricity or even produce hydrogen? What are the things that
you think have to happen? What kind of help has to be there for
our industry-leading companies to do that?
Dr. Murrell. Thank you, Senator. The answer is simply to
continue what we're doing with the large pilots, the
demonstration projects, the prove-out of the technology itself.
If we look historically at CCUS across the country, it has been
a story of technical success and economic failure, and that
brings up the role of 45Q in the future as well and the
boosting of that from where it is at $50 per ton perhaps up
to--I believe $85 per ton has been mentioned in passing before.
Those things have to be implemented and executed in the field
and get these things proven out as real and viable
technologies, not just for the preservation of our thermal
fleet, but also in the context of development of a blue
hydrogen economy.
Senator Hoeven. And where do you see the first hydrogen
going in bulk? Provided that we can do this, where do you see
that fuel going?
Dr. Murrell. So if I can speak to the examples in Wyoming,
it is mostly--there are nodes of interest. There is a
southwestern area of interest around the Opal and Echo Springs
natural gas processing facilities and there is a southeastern
node around the Cheyenne area, which is mostly, predominately a
renewables source and they are looking more toward the--they
are good production centers there obviously looking for a
value-chain integration in terms of consumption. So the
southeast port around Cheyenne is obviously looking toward
delivering hydrogen into the Denver metropolitan area. The
southwest pool is looking more toward Salt Lake City, even
further afield, utilizing our existing natural gas pipelines to
deliver it further to the west coast and perhaps even beyond.
There is a lot of competition. Not just Wyoming and North
Dakota, but Texas. This area around here in Chairman Manchin's
region is also having great progress with development, and a
lot of it hinges on that value-chain integration, connecting
the generation with the consumption centers.
Senator Hoeven. What do you see as the use of that hydrogen
in those nodes? What is primarily a good use?
Dr. Murrell. Yes, it is going to be multiple use. If you
look into Denver, it will be a combination. Probably first of
all as a transportation fuel, but there is also great
opportunity to step forward into more of a utility-based
consumption model and then further after that, it will be more
into the advanced technologies around synthetic fuels and
petrochemicals and others. I think for the most part it will be
led by a combination of either transportation fuels or the
utility power sector.
Senator Hoeven. How soon could we be making this happen in
your opinion?
Dr. Murrell. In Wyoming we have nine projects--real
projects--in development. The first hydrogen--we are probably
looking in the next 18 months or so.
Senator Hoeven. 18 months?
Mr. Hlavinka, kind of the same question--where do you see
this product going? Who is going to get it done first in your
opinion and can we use the existing pipelines, like natural gas
pipelines?
Mr. Hlavinka. Thank you for the question, Senator. Kind of
tacking on to what Dr. Murrell said, we have at Williams a real
project in the State of Wyoming that is focused in the Opal
region where we are taking wind power produced in the state and
generating clean hydrogen that we plan to put into our pipeline
system. We own an asset called Northwest Pipeline, which moves,
currently, natural gas from Southwest Wyoming up to the Pacific
Northwest into states like Washington and Oregon. We see the
ability to blend that hydrogen into our existing systems as a
great start to really begin the development of a clean-hydrogen
economy. Our customers, many of whom are power generation
customers, many of whom are local distribution companies or
other industrial users, are trying to find ways to decarbonize
their fuel supply as well. And so we see this as a great way to
start using our existing assets.
We also see the ability for ourselves to utilize hydrogen
as a fuel. We run a number of compressor stations along our
pipelines that consume fuel. And we think hydrogen is a great
way for ourselves to decarbonize as well.
Senator Hoeven. Dr. Satyapal, shouldn't we be doing more to
make sure that we are deploying carbon capture technologies as
part of developing this move to hydrogen?
Dr. Satyapal. Thank you, Senator Hoeven, and I would also
like to thank you for your leadership on the Hydrogen and Fuel
Cell Caucus. First of all, on all the support for hydrogen, and
as you know, in the Bipartisan Infrastructure Law, we have
tremendous opportunity for CCS as well. So our office is
committed to accelerating progress there as well.
Senator Hoeven. We want to work with you on the CCUS. We
are a long way down the trail and look forward to continuing to
make sure that we make it commercially viable and want your
help in doing that.
Senator Lankford [presiding]. Senator Cortez Masto.
Senator Cortez Masto. Thank you.
First of all, just let me just say, I so appreciate this
panel and the discussion today. I am sorry the Chairman had to
step out because I do think, to put this in perspective, we are
all saying the same thing here. It is the opportunity to--
depending on where we live--identify what clean energy
portfolio works best for us based on our geography and minerals
and background with the outcome of reducing the carbon
footprint and taking into consideration investments and
technologies that are going to help us do that. One of the
things that I think is important for all of us to remember--we
have all supported this--was that innovation economy is also
going to be beneficial for us, but we also have to ensure we
continue to focus on the critical minerals that are important
for that innovation technology. I think it is an all-hands-on
approach.
So to me, it is not just about making sure we invest in
solar and geothermal and other opportunities. It is investments
in everything that is going to help us reduce the carbon
footprint. Not one of them is competing against the other. They
are compatibles. That is my understanding.
Mr. Graff, let me just ask you this and it is great to see
you. We are so excited that you are in North Las Vegas, and we
are looking forward to continued collaboration because you are
going to bring incredible opportunities for jobs as well in
this sector. But sometimes there is this idea that electric
vehicles compete with hydrogen fuel-celled vehicles and
technically, they really do not. They are compatible with the
goal here of reducing a carbon footprint, right? So we should
continue the investment in both, but making sure that
investment here in the United States is happening because other
countries are already doing it. Is that correct?
Mr. Graff. That is correct, Senator. There is no doubt that
I think that there is a clear path forward for both to be used
in the right uses, the right places, and the right ecosystem.
It is already proven that the light-duty vehicles are already
working with batteries. You have to make sure you continue to
bolster the grid--provide that capability. There is no doubt
that there is a real place--as I mentioned before in all the
ways, which I won't repeat--for the use of hydrogen as well.
Globally, there is a huge effort in this regard. I think 30
countries around the world have already developed a clear
hydrogen strategy and pathway for their countries. And there is
probably a level of $70 billion plus incentives from various
governments to go ahead and help incentivize that to occur.
There are somewhere in the order of 230 large-scale major
projects announced, of which 85 percent are in Europe, Asia, or
Australia. The others are a mix between the Americas and the
Middle East. And so I think that there is a real focus on this.
Those projects, as announced, that have come out, are $300
billion in investment of which, I think, about $120 to $130
billion is already in engineering or in construction.
So I think it's real. I think we have to recognize those
pathways and I would fully agree that we have to look at this
as an ecosystem for a given geography. And we have to make sure
we tailor the use and the benefits to reduce the carbon
footprint in any way possible with that ecosystem and even
utilizing renewable forms of natural gas from landfills and
biodigesters, which we know how to do.
Senator Cortez Masto. That's right. Thank you.
Let me ask you, Dr. Satyapal, I thank you for your work and
leadership at the Department as well. When it comes to hydrogen
jobs--you talked a little bit about this--because I think this
is another opportunity to really grow our workforce, and you
highlighted the need for the U.S. to develop that robust
workforce. Can you please talk to us about what types of
background or professional experience or what types of jobs
will come with this investment in hydrogen fuel?
Dr. Satyapal. Thank you so much, Senator. We did actually
launch a new project called H2EDGE, which will help us to look
at the workforce needed and training, accreditation, and
because it is so diverse, we have the entire value chain, so
production, construction, engineering, maintenance, repair,
hydrogen tanks,
infrastructure, dispensers, the actual fuel cells, membranes,
electrolyzers. So there is just tremendous opportunity across
the entire supply chain.
So the 700,000 jobs opportunity was mentioned, and we will,
as we launch the hubs and get more deployments, we will have
more awareness of where exactly are those jobs and how to
ensure that they are sustainable.
Senator Cortez Masto. Thank you. Thank you, again. This is
a great discussion. Thank you to the panelists.
Senator Lankford. Senator Marshall.
Senator Marshall. All right, thank you, Senator.
And certainly, we all do agree here--the panel and the
members here on the dais--that we share the same goals. We do
not always agree how to get there, and I think we disagree
sometimes on how we environmentally score the impacts of these
different technologies.
Mr. Hlavinka, I grew up in a small oil town. We had three
oil refineries, and a Williams pipeline had a large presence
there--several friends whose fathers worked there, and they
were really good jobs, well paid. My grandfather was a welder.
I could weld, but welding for a pipeline is a very special
skill, and I have seen the technology improve through the
years. I am told it is 95 percent more efficient--95 percent
less gas is released or fuel spillage, those types of things
from pipelines today. Most all of our land, farmland we own,
has pipelines running through it and the environmental impact
is nothing. We graze cattle back where the pipeline is. We farm
over them. The pheasants, the quail, don't seem to mind that
there is a pipeline under there.
On the other hand, in the last 25 years we have had an
explosion of wind energy in Kansas and I am grateful for that.
I think 45 percent of the electricity in Kansas is generated
from wind. But I have seen their environmental impact really be
significant. The power lines that carry these, the towers are
50 percent taller, I am guessing. They are made out of steel
rather than wood. They are thicker. They are bigger. And as
solar farms come in behind them as well, that--there is a
significant environmental impact of getting that energy, the
wind energy or solar energy out of Kansas because we don't need
it all. We are selling it as well.
How do you score environmental impacts of your industry
pipeline versus something from wind energy or solar energy on
the transportation part of it?
Mr. Hlavinka. Sure, thank you, Senator Marshall.
I would say to start, we agree that the most efficient and
safe way to move energy is through pipeline infrastructure. It
is why we are focused on finding ways to make sure that as the
hydrogen economy develops, we can utilize existing
infrastructure to do just that. That said, I think we are very
big believers in an all-of-the-above approach. We think that
wind and solar do have a role to play in the future of energy,
both as just power producers, but also suppliers to hydrogen
production. And so as part of our base business, we are very
focused on ensuring we can continue to deliver.
Senator Marshall. Do you have a way to score environmental
impact of pipelines versus transmission through power lines for
solar and wind? I cannot find that.
Mr. Hlavinka. In terms of scoring, there are definitely
life-cycle analyses that can be done. I kind of relate it back
to efficiency as well, of how much energy you are losing
through those processes. And so I do believe that there are
metrics that can be shown to compare the two, yes.
Senator Marshall. Okay.
Dr. Murrell, I wanted to continue down this pipeline of
environmental footprints from cradle to grave. In Wyoming, you
consider the cradle-to-grave impact--environmental impact of
hydrogen versus coal versus natural gas. How do you guys look
at that--not just tail pipe emission, but the total
environmental impact? How do you score that?
Dr. Murrell. Thank you, Senator.
It is a difficult question to answer because it is such a
broad context. Mr. Hlavinka mentioned life-cycle assessments.
Life-cycle assessments are extremely sensitive to the model
that you are trying to understand. So being able to compare one
to another is literally the apples and oranges problem. But we
take it as very much a holistic view. That is why we are
attempting a net-zero aspiration in the state, which is scope
one, of course, which is our direct emissions. It allows us to
have portions of the economy that are emitting CO2
and other greenhouse gases, and that allows us to accommodate
those varying economic parameters and industrial parameters
within the state.
Senator Marshall. Okay. Any time left? Yes.
Dr. Satyapal, any thoughts on how you score environmentally
cradle-to-grave hydrogen energy?
Dr. Satyapal. Yes, thank you so much for the question. We
do have quite a bit of effort also coordinating
internationally. We are a co-lead of international partnerships
with over 20 countries. So developing common methodology, also
looking at, for instance, dig-once policies, how to use
existing conduits, trying to minimize the risk. And with our
national labs, we have consortia--HyBlend and H-Mat materials
consortium--to help, again, identify how to reduce the risk,
appropriate materials for the pipeline----
Senator Marshall. So right now do you have a cradle-to-
grave environmental score for hydrogen energy?
Dr. Satyapal. Right now, again, as we look at the
Bipartisan Infrastructure Law, we would be looking at those
types of criteria.
Senator Marshall. If you have some data that could show me
the environmental impact, cradle to grave, of hydrogen energy,
how you are going to measure this going forward, I would love
to see it, not just the carbon score, but the environmental
footprint.
Dr. Satyapal. Yes, we have already started looking at
sustainability-screening tools and I would be happy to follow
up with you.
Senator Marshall. Do you have data now that I can look at?
Dr. Satyapal. Well, we have various analyses. I think the
validation will be really important. We will get the data as we
look at the hubs and the build-out. We don't have sufficient
scale yet.
Senator Marshall. Okay, thank you. I yield back.
Senator Lankford. Senator King.
Senator King. Thank you, Mr. Chairman. It is nice to see
you in that seat. I compliment you on your meteoric rise.
I think there are a couple of general points. Number one,
this is a very important hearing. Number two, a general point
is--research is key. We have just got to keep investing in
research and that is where the Federal Government can play an
important role. As we all know, the shale gas revolution
started with Department of Energy support for basic research
that George Mitchell then used to develop the fracking
technology. So the investment by the Federal Government, by the
Department of Energy, I think, is absolutely critical.
Number three, in response to Senator Marshall, I completely
agree. We need cradle-to-grave analysis. One issue on the blue
hydrogen analysis that I think we have to bear in mind is not
only the methane and other costs at the production point, but
the upstream methane that is released now in production and
transportation. That has to be a major concern. As you all
know, methane is 80 times more potent as a greenhouse gas than
CO2. So I think that is something, when we are
talking about blue hydrogen and assessing environmental cost,
we have to talk about fugitive emissions upstream until we get
those under control.
I am a huge believer in renewables--in solar and wind. On
the other hand, I am also a huge believer in reality. And right
now, I just checked, in New England about seven percent of our
electricity is being generated by solar and wind. In order to
achieve a fully decarbonized economy through renewables, in
other words, we would have to have ten times the solar and wind
capacity that we currently have. That is a big deal. If you
drive around Maine, you see a lot of big solar farms now, and
the idea of multiplying it by ten is something we have to think
about because we are going to have to over-build solar and wind
in order to produce the excess energy to store, whether it is
hydrogen, batteries, or others. So we have to have 100 percent
capacity.
A couple of specific questions.
Mr. Graff, are we going to see a cost curve on
electrolyzers that is equivalent to what has happened with
solar and wind over the last ten years?
Mr. Graff. Senator, there's a lot of work and a lot of
effort right now to work on electrolysis and the cost to
produce by electrolysis, certainly, with the support of DOE and
some of the programs and research ongoing there, along with the
incentivization of the Clean Hydrogen Production Act to further
build at scale and start to demonstrate how this can work. So
we will see that pathway. We will see it evolve. It will take a
while with that research and that effort and to build at scale
to get it down to parity with the production costs of hydrogen
as we know today without carbon capture.
Senator King. Right.
And it is also going to be competing with batteries and
pumped storage and all the other storage technologies.
Mr. Graff. It definitely will. I think as all of these
elements grow, we certainly need to go ahead and reinforce and
grow simultaneously to achieve our needs. As we electrify
everything from the grid standpoint, we also have to look at
the infrastructure there and how we source that and what we do.
And that's why, I think to your point, if we are going to use
solar and we are going to use wind, we don't only need to
produce excess, but we also need to store it. I mentioned
before what we can do with a storage cavern to make that work
as well.
Senator King. One question, a quick technical question. You
talked about trucks using this. Isn't hydrogen significantly
less dense in terms of energy than gasoline, and how big a tank
would you need on a truck to get 200 miles or 300 miles of----
Mr. Graff. So it is definitely less dense, but you are not
utilizing it in an internal combustion engine. So it is far
more efficient in its delivery of power to go ahead and drive
the vehicle.
Senator King. Would it be delivered to an electric motor?
Is that the--that's the technology? Are we talking about a fuel
cell, effectively?
Mr. Graff. Exactly. Basically, they are all electric
vehicles.
Senator King. Right.
Mr. Graff. It's just a question of do I have a battery that
I charge from the grid----
Senator King. Right.
Mr. Graff [continuing]. Or do I actually produce the power
on board?
Senator King. But a fuel cell that would give a truck
significant mileage wouldn't be as big as the truck is what I
am asking.
Mr. Graff. No, no, it would definitely be small enough that
it would be comparable to what we have today, and it would be
leveraged in a way that you would be in a place where you would
maintain the usability of that freight capability and utilize
the full capacity of those trucks and those vehicles.
Senator King. I may follow up with you in questions for the
record because I am running out of time.
Mr. Graff. Sure.
Senator King. On pressure, temperature, practicality of
storage, transportation, those kind of things.
Senator King. Mr. Hlavinka, quick question. If you have a
wind project, is there potential here for a package project
where you have a wind project and then you have an electrolyzer
onsite? Because when you have a wind project, by definition,
you have the transmission system. You have the wires already
there. So you do not have to transport. You could make the
hydrogen right on the site, have a generator based upon the
hydrogen on the site so you have, essentially, a base-load
plant. Is that a feasible engineering concept?
Mr. Hlavinka. Yes sir, and thank you for the question,
Senator.
It definitely is, and it is a concept that we are currently
putting into practice through the Wyoming project that I
mentioned earlier. I would say taking that power and making it
into hydrogen and then moving it long distances is much more
efficient than moving it on a wire long distances in terms of
energy losses. And so really the question comes down to where
is the end use? Where is the market for that molecule? And that
would kind of dictate what is the best outcome.
Senator King. Sure, you have line losses, but if it is
going into the local grid, then that is not a terribly
significant factor as opposed to pipeline and the
infrastructure development.
Mr. Hlavinka. Agreed. I guess what I would say is,
typically when it comes to wind and large-scale wind and solar,
they are not usually located next to or adjacent to large power
demand.
Senator King. Right.
Mr. Hlavinka. So that is really our approach--to find where
is the demand.
Senator King. So your project would be wind, electrolyzer,
hydrogen, pipeline?
Mr. Hlavinka. Yes, sir.
Senator King. Great. Thank you.
Thank you, Mr. Chairman. What happened to Lankford?
The Chairman [presiding]. We sent him out.
Senator Murkowski.
Senator Murkowski. Thank you, Mr. Chair.
The Chairman. Time was up.
[Laughter.]
Senator Murkowski. Senator King, I always love listening to
your questions because it is just such a free range of
exploratory ideas. So thank you for that.
Good hearing this morning, and I am sorry that I missed
your testimony that you provided here to the Committee. I read
what you had submitted and again, this is an area where we
think we have great, great promise. I note that the Department,
just today--or maybe, I guess it was, yes, last night--is
announcing some restructuring to help facilitate and streamline
the implementation under the Bipartisan Infrastructure Law,
which is good and I think notable and certainly timely.
Question for you, Dr. Satyapal. Has the Department of
Energy identified any regions that it believes would be
suitable for a hydrogen hub? This is the criteria that we had
outlined in the Infrastructure Investment and Jobs Act. I have
received two letters from our Governor. One was directed to
you, Mr. Chairman. The other one was directed to Secretary
Granholm, talking about Alaska's clean hydrogen potential,
outlining the substantial resources that we have, really
superlative--sequestration basin, access to certainly the Asia
markets there. Mr. Chairman, I would like to submit these
letters for the record from our Governor that highlight these
potentials.
The Chairman. Without objection.
Senator Murkowski. Thank you.
[Letters from the Governor of Alaska follow:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Senator Murkowski. Dr. Satyapal, what work has been done to
identify these regions? Is Alaska being considered? Can you
tell me where you are with that?
Dr. Satyapal. Thank you so much, Senator Murkowski. It is
an honor to meet you. We have done significant analysis. We
have three reports that have been published looking regionally
at resources. We announced just today, I mentioned before you
came in, that we will be issuing two requests for information
to get more feedback and we also launched a tool, H2
Matchmaker, which is public and which will allow producers and
users to identify themselves. So there is significant activity
underway. And I should just mention that my sister office, the
Arctic Office, as you may know, we are planning a workshop on
hydrogen in your state and the Governor has been engaged. So we
really look forward to engaging.
Senator Murkowski. Great. Well, again, I would hope that
some of the attributes that the Governor has mentioned would
certainly be considered as you are making those determinations.
Continuing with you, can you share what the
Administration's policy is with regard to converting natural
gas to hydrogen? We recognize that there are some within the
Administration--certainly some groups that may have influence
on the Administration--who are very, very firm about not using
fuel sources like natural gas. So the question is, is there a
role for conversion to play, and what might we anticipate with
regard to support and funding that might come with it?
Dr. Satyapal. Thank you, again, for the question, and as
mentioned with Hydrogen Shot, we are really looking at all of
the pathways. It is really about clean hydrogen. So whether it
is natural gas, carbon feedstocks, nuclear, renewables, you
know, any pathway to get to the low carbon intensity, we are
really pivoting away from the colors. There is a lot of
complexity--green, blue, purple, turquoise.
Senator Murkowski. Right.
Dr. Satyapal. Pyrolysis is another approach. In fact, our
loan program office just announced financing of $1 billion.
Solid carbon, which is another value-added product--no need for
the CCS portion. So definitely an all-of-the-above strategy is
needed to meet all of our goals.
Senator Murkowski. And that sounds like it certainly
includes natural gas.
So this may be directed to you, Dr. Satyapal, or perhaps
Mr. Lewis. I am focusing on the enormous potential that we see
in Alaska with hydrogen, and particularly we are looking at
ways to decarbonize our fishing industry. We have a strong
commercial fishing industry. We have commercial marine
navigation. We have transportation marine fleets. Can either of
you speak to the feasibility of utilizing hydrogen as a clean
source of propulsion for our ships and whether or not you are
aware of any work that is being done with regard to
commercialization of technology. I am asked when I am back home
what the prospects might be, and if either of you could speak
to that?
Dr. Satyapal. Yes, I am pleased to say that we actually
have a project--first of its kind--the first hydrogen ferry in
the Western Hemisphere. We are funding an electrolyzer on the
pier that would actually refuel the ferry and then also a fuel
cell. So once we generate electric power, we will also be able
to charge a battery electric vessel, and we are coordinating
internationally as well. There is significant activity there.
Senator Murkowski. Where are you doing this with the ferry
pilot?
Dr. Satyapal. The current project that applied and was
selected will be in California.
Senator Murkowski. Because we have, I think, a very unique
marine highway system, and again, something interesting to
explore.
Mr. Lewis, did you have anything further that you wanted to
add?
Mr. Lewis. Yes, in addition to the great work that is being
done on hydrogen fuel cell propulsion for marine vessels,
another way of accessing hydrogen energy is through ammonia.
Ammonia-powered internal combustion engines are being developed
for long-haul, transoceanic shipping, and may be quite useful
for deep-sea fishing. And so there is a lot of work being done
on that front, mainly for container and freight ships, but I
think there is going to be a lot of learning that will also be
applicable to long-haul fishing.
Senator Murkowski. So just a point of clarification on
that. Do you think that ammonia would be easier to do when it
comes to commercial fishing?
Mr. Lewis. We think it will be because you can store the
ammonia energy more readily than you can store enough hydrogen
to get across an ocean, for example.
Senator Murkowski. Yes, Yes. Okay, good.
Well, thank you, I appreciate that.
Thank you, Mr. Chairman.
The Chairman. Very interesting.
Senator Hirono.
Senator Hirono. Thank you, Mr. Chairman.
Mr. Lewis, Hawaii has a goal of reaching a 100 percent
carbon-neutral economy by 2045. I think we have the most
ambitious standards in that regard. As islands, Hawaii is
highly dependent on marine shipping. You described in your
testimony the potential for hydrogen or hydrogen-based ammonia
to serve as a low-carbon fuel in long-distance marine shipping.
What are the next steps that companies and the Federal
Government need to take to determine the usefulness of low-
carbon hydrogen in marine shipping?
We would love to see more commercial demonstrations. We
have been working with the marine industry to encourage and
promote the development of hydrogen-based shipping for several
years now, and the deployment period is typically still a year
or two away, but we are getting to the point where there are
companies that are saying that deployment of clean ammonia-
fueled vessels should be in the water next year. There is a
mining company in Australia that expects to deploy an ammonia-
powered freight vessel by the end of this year. And so we are
getting to the point where it's becoming a viable commercial
option. We would love to see more support though, to
demonstrate that technology and to test that technology. There
are still key questions about using ammonia as fuel that need
to be answered.
Senator Hirono. Well, when you say that you would love to
see more support, what kind of support?
Mr. Lewis. Investments in pilot demonstration projects,
investments in the development of ammonia bunkering systems at
key ports around the world, particularly in the United States.
Senator Hirono. Did you say you have been working with some
private companies?
Mr. Lewis. We have, yes.
Senator Hirono. Is Matson one of those companies?
Mr. Lewis. We have not been working with them. One of the
efforts that we are involved in that we are most excited about
is actually working with retail companies that are the cargo
owners, companies that move their goods from production regions
of the world to places like the United States. Many of those
companies have corporate-wide decarbonization goals, and to
reach those goals they need the Scope 3 emissions from the
shipping to be eliminated. So we are working with those
companies through an effort called the Cargo Owners for Zero
Emission Vessels, or coZEV, to signal demand to the market for
zero-carbon shipping. That coZEV effort, which includes
companies like Amazon, Patagonia, and IKEA, coming together and
trying to figure out how to communicate that demand to the
market and look forward to engaging with cargo owners to
provide zero carbon shipping.
Senator Hirono. So you do not do that much with the marine
shipping side of shipping?
Mr. Lewis. With the carrier companies?
Senator Hirono. Yes.
Mr. Lewis. We have yet to engage closely with the carrier
companies--no, that's not true, I'm sorry. We have worked with
Maersk a little bit to understand what they are doing, and they
are doing quite a bit.
Senator Hirono. My next question is for Dr. Satyapal. I
apologize if I am mispronouncing your last name.
Again, we have a goal in Hawaii of 100 percent renewable
power by 2045. Hawaii's biggest utility, Hawaiian Electric, has
identified green hydrogen made with renewable power as one
potential source for achieving Hawaii's goal of 100 percent
renewable power. Hydrogen would serve as a way to store
renewable power for later use to complement the variability of
solar and wind power. The Bipartisan Infrastructure Bill
includes $1 billion for the demonstration, commercialization,
and deployment of electrolyzer systems. Doctor, could you
elaborate on how you plan to use the infrastructure bill
funding to develop hydrogen from renewable power and then
determine how it could be used to help use higher levels of
renewable power?
Dr. Satyapal. Thank you so much, Senator, for the question.
If I may also just mention, we have projects in your state
related to the marine. In fact, we demonstrated the world's
first pier-side fuel cell instead of a diesel generator to
power vessels along with the Maritime Administration, and also
have other activities--a shipping mission, ammonia, liquid
fuels, hydrogen, electrification--an an all-of-the-above
portfolio. And then, I mentioned before you came in that we're
very excited to announce that we plan to release two requests
for information to solicit feedback. We already have a very
comprehensive electrolysis program and have cut the cost 60, 80
percent already. We still need much more. Durability,
efficiency, so again, we have a pretty comprehensive effort and
really appreciate the Bipartisan Infrastructure Law.
Senator Hirono. Thank you very much.
Thank you, Mr. Chairman.
The Chairman. Senator Kelly.
Senator Kelly. Thank you, Mr. Chairman. Great that we are
having this hearing on clean hydrogen and hydrogen fuel cells.
It is the way we generate our electricity aboard the space
shuttle. So I have a little operational experience with these.
Dr. Satyapal, thank you for testifying today. The
Department of Energy has a tremendous opportunity that I do not
want overlooked in today's hearing. In the Southwest, we can
produce and transport substantial amounts of clean hydrogen.
For starters, our solar potential is exceptional and we have
the Palo Verde generating station, which is the largest nuclear
power plant in the country that is producing hydrogen by
electrolysis. So we have the energy capacity to be well
involved here.
And then the I-10 and I-40 corridors are perfectly situated
to transport hydrogen from the East Coast and Rocky Mountain
states into California and then even overseas. New Mexico is
expanding their carbon capture and storage capacity. Arizona
and New Mexico are looking into the $8 billion in the
Bipartisan Infrastructure Law for the development of clean
hydrogen hubs across the U.S. If the Department of Energy
designates the Southwest as a hydrogen hub, it would help the
country meet our climate goals. It would also provide badly
needed jobs for the Navajo Nation, which is the largest
indigenous population in the country. Hundreds of Navajo
workers have been displaced as coal plants on the Navajo Nation
began to shut down. The Navajo government is looking at
hydrogen as a way to build their economy.
So Dr. Satyapal, the Bipartisan Infrastructure Law directs
DOE to establish at least four hydrogen hubs. Would you
estimate that there is a need for more than just four hydrogen
hubs?
Dr. Satyapal. Thank you so much, Senator. I should just
mention that before I joined DOE 18 years ago, the company I
worked for--every American manned space mission used our fuel
cells.
Senator Kelly. Great.
Dr. Satyapal. So it's an honor. In fact, I brought a sample
here, but as you know, only water is the product. Astronauts
can even drink that water, so----
Senator Kelly. Well, we wind up with so much water from
these fuel cells that we have to dump it overboard. I mean, we
will transfer some of it to the space station, but if we are
not docked to the space station, our fuel cells generate
electricity and they also, you know, we wind up with heat and
water and the water we have to--there is so much of it--we have
to dump it overboard and that is actually a good thing.
Dr. Satyapal. Yes. And again, going back to the leadership
issue that the Committee has raised going back to the Gemini,
the Apollo, the United States was the leader in hydrogen and
fuel cells, so again, I really appreciate the interest. And as
I mentioned before you came in, we will be issuing a request
for information on getting feedback from the communities, all
the stakeholders on how best to implement the Bipartisan
Infrastructure Law including the bill and the hubs and the
other provisions. And I do want to mention that we did also
just award $20 million, which will use the Palo Verde nuclear
power.
And going back to Senator King's question, we really cannot
avoid stranded assets. So if you are going to have intermittent
renewables--solar or wind--one of the concepts is a hybrid
system where you come in with baseload nuclear so that you have
higher utilization of the electrolyzer, and that is what will
help us to get the cost down as well. So again, it is very
complex and those hybrid approaches, again, we are really
excited. We have five nuclear hydrogen projects, and this was
just announced as well. So I wanted to highlight again the
value of these demonstrations, these pilot demonstrations, and
they will help to ensure that the hubs and the next generation
of deployments will really be market-successful and
sustainable. So thank you.
Senator Kelly. Do you think we need more than four?
Dr. Satyapal. We will definitely look forward to the
feedback from stakeholders as we design the most effective
strategies.
Senator Kelly. And then I have one request, if you and the
Department of Energy would engage in some tribal consultation
as we develop this hydrogen hub initiative, because this could
be a real benefit to the Navajo Nation.
Dr. Satyapal. Yes, and our Office of Indian Energy has
already spoken with the Navajo Nation. In Section 815 it also
specifically mentions engaging tribal, Native Hawaiian--and so
again we look forward to coordinating.
Senator Kelly. Thank you. Thank you for your testimony.
Thank you, Mr. Chairman.
The Chairman. Thank you, Senator.
That wraps up our first round of questioning. We are going
to have to be going to vote, but let me just thank you all for
your wonderful testimony and participating in this panel, which
is extremely, extremely informative.
I would like to say just one thing on behalf of all of us
that have an interest in these hydrogen hubs. I think you have
made abundantly clear where the hydrogen economy can go. I did
not know if any of you all could comment, but if you were in a
state that was trying to secure a hydrogen hub, what would you
recommend as the selling point of your state that you would
like to see or like to make sure people know within your
application that could be of help?
You start, okay, Mr. Hlavinka.
Mr. Hlavinka. Sure, and thank you for the question,
Senator.
I would say we are looking at multiple hub opportunities,
but specifically we are a company based in Oklahoma. I think
Oklahoma has a lot of fantastic attributes that fit the
criteria for the hub. You have a great wind resource. You have
a great natural gas resource. You have a great existing
infrastructure to leverage. You also have proximity to the
transportation hubs that the corridors use for moving large
vehicles east and west across the United States and proximity
to the Gulf Coast. And so if you put all those together, I
think it's a great fit. It checks a lot of the criteria boxes
that have been asked for in the hubs.
The Chairman. Mr. Graff, what are you looking for to move
one in?
Mr. Graff. Senator, we are in all 50 states. We are already
active in every state in many respects, and I would build on
Brian's comment, and I think that in addition to that I think
another benefit of a hydrogen hub is not just the ecosystem
that is available in terms of the energy resources and how we
would manage that, but how do we integrate this among different
users? Is there a way to integrate this capability into
industry, into transportation, into power as appropriate? We
see this happening in other parts of the world where you see
the beginnings of infrastructure being built that is able to be
leveraged into multiple needs and multiple places, and they
would look at a basin or a hub type concept for themselves in
order to do that.
So I think we would look at all of those things in any
state and look for the opportunities of working with that state
or that group of states to make that work.
The Chairman. Mr. Lewis, do you have any comments?
Mr. Lewis. Yes, thank you. We think that the attributes of
a good hub, in general, are lots of potential off-takers for
hydrogen, like major truck depots, ports and industrial
facilities, opportunities for strong public engagement, and a
commitment to delivering near-term environmental benefits, such
as reductions in diesel emissions. At a natural gas-based
production hub, we think that there needs to be supply of
affordable natural gas, of course, good access to high-quality
carbon sequestration reservoirs, and a strong system in place
for detecting and eliminating methane leaks from the gas
production and transport infrastructure. And if it's an
electrolytic production hub, we would like to see, obviously, a
surplus of renewable energy, or a surplus of nuclear energy, or
both.
The Chairman. Sure. Dr. Murrell.
Dr. Murrell. Well, I represent one of those states, and my
advice would just be everybody else just give up and let us
win.
[Laughter.]
Dr. Murrell. No, but in seriousness, I think it is more
about diversity of fuel sources or renewables plus others as
well, other hydrocarbons and nuclear and critical pieces, of
course, are the value-chain integration. It is all well and
good if you can produce a lot of hydrogen. You have to have
off-take as well. So integrating with demand centers.
The Chairman. And Doctor.
Dr. Satyapal. I will just say that we have spent a
significant amount of effort looking at how best to implement
both strategically and tactically. So again, we really look
forward to working with all of you, all of the stakeholders, to
design the best possible approach.
The Chairman. Well, let me just say you all have whetted
everybody's appetite as far as why we should be moving to
something that we can do in America. We do not have to depend
on our foreign supply chains to continue to transform and
transition to this clean energy technology. So we appreciate it
very much, and with that, Senator Lankford.
Senator Lankford. Mr. Chairman, you all, thanks. This has
been extremely helpful, being able to walk through all the
issues with hydrogen today. I appreciate all the engagement on
this.
I do want to drill down on the transition. We have talked
about possibilities, but this panel knows extremely well how
this conversation about hydrogen being the next thing has been
the conversation for about 25 years. And so there is a lot of
dialogue about how does that transition actually happen? How do
we get down to efficiencies? So I have some questions on that
portion of it.
Mr. Hlavinka, thanks again for your testimony and your work
in this area. The existing natural gas pipeline covers the
entire country. As Dr. Satyapal mentioned earlier, we have
about 1,600 miles of hydrogen pipeline. That is not close to
what would actually be needed. What do you see as the
transition for moving hydrogen? We are not going to put it on a
truck and drive it around. That is not going to be efficient.
What is going to be needed? What do you see as that transition
for the existing natural gas pipeline structure?
Mr. Hlavinka. Yes, thank you, Senator Lankford.
I would say that is really why we are so interested in
hydrogen. We think the ability to utilize the existing
infrastructure that really covers the entire Lower 48 is
incredibly important. We are doing near-term blending projects
to start proving that concept out. As part of our testimony, we
submitted a report from the Pipeline Research Council
International that talks about the state of existing natural
gas infrastructure--how much can we blend now? What needs to be
done? What do we need to address to continue to move that blend
higher? So we are very excited about that. We have near-term
projects to go prove that and show what our asset base can do.
Senator Lankford. Okay, so when you talk about blending----
Senator King. Excuse me, so I am confused. Can you put
hydrogen in a pipeline with natural gas?
Senator Lankford. That is exactly where I was going next on
this, yes.
Senator King. Okay.
Mr. Hlavinka. Yes, Senator, that is exactly right. So the
idea would be to blend hydrogen into the existing natural gas
infrastructure to create a decarbonized product moving forward.
Senator Lankford. So you are talking about something
equivalent, what we knew and talk about all the time, about
gasoline being mixed with ethanol to be able to deliver that,
and that product to be burned in the same way but having a
mixture of natural gas and of hydrogen, and that being an
initial way to be able to use existing infrastructure to feed
hydrogen into the line and have a blend at the other end, so it
reduces the carbon footprint but it is not total hydrogen.
Mr. Hlavinka. That is exactly right.
Senator Lankford. So just to clarify as well--I would
assume there is not a day where we are all natural gas in this
pipeline and then on Thursday and then Friday it is all
hydrogen the next day. Orifices would have to be different to
burn it. Everything on the other end of it, in the delivery has
to be different to be able to handle hydrogen than they do
handling methane on that. What do you see as a transition? And
my next question is going to be on the regulatory side of that.
Are there regulatory barriers this Committee needs to know of
if we are going to move hydrogen? Is that a different
regulatory issue than moving natural gas? What are we facing?
Mr. Hlavinka. Yes, great question, Senator.
So I will start with the downstream impacts that you
mentioned. It is definitely a key part of our analysis, is
understanding today's natural gas users--how would a hydrogen
blend impact them? The challenge around that is that the
natural gas infrastructure touches a lot of different end
users. It's liquefied natural gas. It's power generation. It's
utilities that are ultimately sending gas to local distribution
companies that go to your home. So there are a number of
downstream impacts that we want to make sure we understand and
that we can address so that we can continue to safely and
efficiently operate our existing business without jeopardizing
that moving forward.
In terms of the regulatory side of things, we believe that
there are challenges now about building any kind of
infrastructure. We think that if we want to continue to grow a
clean-hydrogen economy, it is going to take incremental
infrastructure that today can be built for natural gas, that
tomorrow could be used for hydrogen. So we will look for
continued support around permitting, and around the ability to
build out infrastructure that is needed for the future.
The Chairman. Let me ask, if I can jump in here, just one
second?
Senator Lankford. Go for it, yes.
The Chairman. And put this into a comparison of ethanol
with gasoline. You go to the pump and there could be as much as
a ten percent ethanol blend, okay? Some people say that they
want nothing with an ethanol blend because of the water in it
that harms their engine. Especially marine engines. Okay, you
know that. So I am able to still have a clean source of
gasoline without ethanol. You do not know if blending has the
same effect in hydrogen blended with natural gas coming in the
same pipeline--if it would have a detriment to the using it in
your household heat that is delivered through the natural gas
pipelines or any other use of the natural gas? We haven't
gotten that far with it to know what the affects may be. Is
that what you're saying?
Mr. Hlavinka. Senator, there are studies going on now to
address that question of what would be the percentages where
you would start to have those concerns and how would you
address that.
The Chairman. Got you. So we are not down there yet, but we
are getting there. And that, I know, Doctor, I want to hear
from you from the research end of it.
Senator Lankford. But it is the same issue really to be
able to with ethanol because----
The Chairman. Yes.
Senator Lankford [continuing]. Hydrogen also does not burn
as hot as methane does. Is that correct? So the British thermal
units on methane are higher than they are for hydrogen. So same
for gasoline and for ethanol. Your ethanol is not as fuel
efficient as gasoline is.
The Chairman. So----
Senator Lankford. So that is also a factor in this. Am I
correct or not correct on that?
Mr. Hlavinka. Yes, you are correct.
The Chairman. Dr. Satyapal.
Dr. Satyapal. Thank you. Just to add--in agreement there.
There are many studies ongoing, so general consensus so far is
that maybe about 5 to 15 percent blends may be appropriate. It
depends on the materials of the pipeline. You can have
embrittlement and issues, and you are exactly right, the end-
use applications, the burners, there may be some modification.
The UK is looking, in fact, at completely 100 percent hydrogen
as some of their pilots in some cities--we're coordinating
internationally.
We also have an initiative called HyBlend. There are now
over 40 companies, along with our other consortium, to look
exactly at what types of materials should be used. The flame is
actually hotter with hydrogen, but again, what I was going to
mention is that I was in Germany about four years ago, and the
world's largest--at the time--wind-to-hydrogen plant was six
megawatts. Now they are substantially larger, but they were
injecting ten percent--that was the blending limit--into the
natural gas pipeline for three years. And so there were no
issues. And so there, in terms of looking at our safety codes
and standards subprogram, our R&D is really helping to inform
the right codes and standards, having the right injection
standard both in terms of the pipelines. And so we are working
with the Department of Transportation's Pipeline and Hazardous
Materials Safety Administration, which regulates safety of
pipelines and also really informing what should those limits
be. So I really appreciate that question.
Senator Lankford. Yes, okay.
Mr. Graff.
Mr. Graff. I know we are short on time, so I will be very
brief just to add to the comments. I think it is clear that
there is a lot of effort underway, as has been said, to look at
what you can blend in the existing pipeline system. But you are
going to be limited as to what you can do, ten percent or
whatever the case may be, and a lot of work is going on on
that. I don't know where that ends up.
We operate some of those pipelines of pure hydrogen today,
and they are constructed with a totally different metallurgy.
They are constructed with different types of fittings and
different types of operations and are really point-to-point for
those that actually need that for a specific purpose so that
you avoid some of these other issues. So I would be happy to
follow up on that.
Another point is when you get to a very high purity,
another part of use is not just the BTUs, but it is also the
fact that hydrogen burns totally clean. You can't see it when
it burns. And so you reach a point where fire eyes and other
things no longer work.
The final point I will make is that we see the opportunity
to build more localization of facilities, so you aren't having
to ship across great distances because each ecosystem may have
the availability, as we spoke of before, for renewable power to
generate hydrogen with electrolysis--to produce it with natural
gas and capture the carbon, and you are able to reduce the
transportation footprint and actually provide jobs in that
locality that are very good jobs.
The Chairman. Let me ask you. Are there any experiments on
blending hydrogen into coal-fired units in the boilers? We have
been able to reduce the NOX in there. Can we do the
same thing by introducing hydrogen to reduce the emissions?
Anybody? Do you know if we have done that?
Mr. Lewis. I don't think it is happening in the United
States, but Japan is pursuing that.
The Chairman. So Japan is pursuing adding hydrogen into
their coal-fired units?
Mr. Lewis. What they are testing is introducing ammonia as
a hydrogen barrier into the coal-fired boiler.
The Chairman. I got you. Okay.
Whenever you get any results, please pass them on. I will
look for them also.
Senator Lankford. I do want to come back to Mr. Hlavinka on
the regulatory side as well and then I have one other question
just on distribution network and then we will wrap it up. Is
that all right?
The Chairman. Yes, go ahead.
Senator Lankford. Alright, let's do it.
So the regulatory sector, you were halfway through that
question before the Chairman appropriately interrupted.
[Laughter.]
Senator Lankford. But the challenge that we have in this
Committee is trying to be able to determine what issues are
going to come at us that literally we have to resolve around
this dais if we are actually going to move forward on hydrogen.
And my perception is, if there is not clarity on the regulatory
issue, who is handling the pipeline? Who is permitting it? If
we end up blending fuels like this, does that change the
regulator on it? All of those issues that are out there and we
need to know if there is something that you all know at this
point that we have to deal with statutorily.
Mr. Hlavinka. Sure, great question, Senator.
And so I would say we are asking those same questions now.
And I think the regulators are trying to figure out where their
scope starts and stops. Specifically when we think about
natural gas blending, we deal with FERC on a natural gas--on
the NGA side of it. And so at how much of a blend does that
stop being a natural gas pipeline and start being a hydrogen
pipeline? Who is going to regulate that? Those are questions
that we are trying to get answered. We need that clarity to be
confident in our investment and confident in moving forward in
these things. And so----
Senator Lankford. Well, if at some point the regulators are
not clear on that, obviously, we have to make clarity on that
to be able to provide statutory clarity and to be able to say
that you do not have to guess because that could change from
Administration to Administration. That does not provide
stability in investment. We are not going to get capital coming
into the market if people do not really know where the
investment is on this.
My last comment was--15 years ago, 12 years ago, multiple,
different trucking companies, basically, that handle the fuel.
Truck stops--they started investing in natural gas, getting
into their spot. So when the transition happened for heavy
vehicles going to natural gas, they would be ready to be able
to sell fuel. Now a lot of those have million-dollar
investments sitting in a station that is not used because the
Federal Government was going to push toward natural gas for
heavy trucking. I would assume those same truck stops are going
to pause significantly before they start moving to hydrogen or
electricity to charge batteries or whatever it may be because
they just got--excuse the pun--burned ten years ago by
investing millions of dollars into what the Federal Government
told them was happening and where it is going next.
How do we avoid that same thing again? And how do we get
those companies to say, okay, this is really the investment
without basically the federal taxpayer doing that. Because that
was private investment that did all the natural gas stuff. Now
we are talking about either federal grants doing it and the
taxpayer having to be able to pay for that mistake or something
else, or loans or whatever it may be. So how do we get to a
point where there is some certainty in it so we do not have
that same mistake again?
The Chairman. There is not much of an answer to that one
because the Federal Government will jump in. I have been
pushing back on--I said this is simple--that I never recalled
reading in the history books that the U.S. Government built
filling stations when Henry Ford invented the Model T. We just
did not do it. The market usually jumped in and did it. The
market is skittish right now because of what--that is what he
is saying.
We will prime the pump. It will be some very attractive
low-interest loans, no-interest loans, trying to get these
markets primed up, but it is going to be a money source sooner
or later and the Federal Government and the taxpayer and the
Treasury should not be left holding the bag, but I am willing
to wait five or ten years to get that back just at our cost,
that is all. So I think that would be enough without you all
putting your capital in jeopardy right now. That is what we are
hoping will happen.
Senator Lankford. Yes, I would agree. I do not think the
federal taxpayer should be involved in that, but that is one of
those challenges out there. R&D is one thing. Distribution is
something entirely different, but we have to win some folks
over that are still ticked.
The Chairman. Let me thank you all again. I know you have
been very, very kind with your time and we appreciate you
making the effort to be here and it has been very, very
helpful.
Members are going to have until the close of business
tomorrow to submit additional questions for the record.
The Chairman. The Committee stands adjourned.
[Whereupon, at 12:00 p.m., the hearing was adjourned.]
APPENDIX MATERIAL SUBMITTED
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