Pennsylvania Hydrogen Hubs – A Vision for Pennsylvania’s Clean Energy Future
In late-October 2023, the Biden Administration announced that it would provide $1.6 billon to help fund the creation of two hydrogen hubs – the Mid-Atlantic Clean Hydrogen Hub, known as “MACH2,” and the Appalachian Regional Clean Hydrogen Hub, known as “ARCH2” – both of which are located in part in the Commonwealth of Pennsylvania. MACH2 is slated for development in the broader Philadelphia metro area and involves a coalition of states on both sides of the Delaware River including Pennsylvania, New Jersey, and Delaware. MACH2 involves a broad list of benefactors and partners including government entities, regional universities, labor organizations, and key industry stakeholders, including electric and gas utilities, energy companies, petrochemical companies, and regional manufacturers. ARCH2 is situated on the opposite side of the Commonwealth in the broader Pittsburgh metro area and adjacent Ohio and West Virginia. ARCH2 likewise involves a broad coalition of state and local governments, academic institutions, labor organizations, and private industries located throughout the Appalachian region.
Federal funding for the hydrogen hubs comes from the 2021 Infrastructure and Investment Jobs Act and is being administered by the U.S. Department of Energy’s Office of Clean Energy Demonstration, which allocated $7 billion to fund the development of hydrogen hubs across the country. The funding was awarded through a competitive process, and in 2023 only seven hydrogen hubs were provided funding, including both MACH2 and ARCH2.
Hydrogen is utilized for a variety of domestic energy needs, and can be used for electrical power generation, transportation fuel, and as feedstock for various manufacturing and industrial processes. The hydrogen hubs are anticipated to produce low-cost clean hydrogen, develop hydrogen pipelines, storage vessels, and fueling stations, and support other downstream projects and facilities that will utilize the clean hydrogen as fuel or feedstock.
Preliminary concept plans for projects involved in MACH2 include development of fleet fueling stations, retrofitting existing pipelines and above-ground storage tanks for hydrogen transport and storage, carbon capture projects, and providing connections to end-users of hydrogen for manufacturing industries in the broader Philadelphia region.
For ARCH2, which is located in one of the largest natural-gas producing regions in the world generated from the Marcellus and Utica shale formations, proposed projects include development of hydrogen fuel storage and delivery stations, power generation and residential fuel cells, transportation fuels, carbon capture projects, development of pipelines and storage facilities, low-carbon ammonia production, and connections to end-users of hydrogen in manufacturing facilities.
Both MACH2 and ARCH2 are expected to create tens of thousands of new jobs. MACH2 is anticipated to create more than 20,800 direct jobs, including 13,400 in the construction sector and 6,400 permanent jobs. Likewise, ARCH2 is anticipated to create over 21,000 direct jobs, including more than 18,000 construction jobs and 3,000 permanent jobs. Both projects incorporate community benefit plans and workforce initiatives to ensure that projects are developed in a manner that will reinvigorate local economies and provide opportunities for professional development in the local area.
As funding was just awarded for MACH2 and ARCH2 in the final quarter of 2023, 2024 is likely to bring a flurry of activity for both hydrogen hubs, as funds begin to be distributed from the federal government, and the proposed projects move from the conceptual stage to implementation. There are four anticipated phases for use of the federal funding – which so far has only been awarded for the first phase of the process. Phase 1 encompasses initial planning and analysis of proposed projects to determine if they are feasible and financially viable and requires detailed plans to be developed within 12-8 months, i.e., by late-2024 to mid-2025. Phase 2 will include completion of engineering designs, permitting, and related agreements, and is anticipated to begin within 2-3 years, i.e., in 2025-2026. Phase 3 will include the implementation of the projects through beginning installation and construction. Phase 4 anticipates that the hydrogen hubs will be fully operating, with continued data analysis to evaluate the hydrogen hub’s performance and financial viability. Each phase of the process will include community engagement and involvement of local stakeholders.
The MACH2 and ARCH2 hydrogen hubs present a unique opportunity for the Commonwealth of Pennsylvania to leverage its existing infrastructure, technical capabilities, scientific and academic strengths, labor force, and manufacturing and industrial operations to continue to serve as a model for the development of clean and sustainable energy.