Green Hydrogen Sails Under Anti-ESG Radar In Texas
![](images/images_05_04_2023/green-hydrogen-aes-texas%20copy.jpg)
In Texas, anti-ESG whiners transform selves into green hydrogen
cheerleaders (photo courtesy of AES).
In Texas, anti-ESG whiners lead the cheer for a massive new green
hydrogen facility supported by wind and solar power.
Public
officials in Texas have been revving the anti-ESG movement into high
gear, in an effort to protect fossil energy stakeholders. However, the
seeds of failure are already written on the wind. That means literal
wind. Among other renewable energy assets, Texas has an ample supply
of wind energy to spur a homegrown green hydrogen industry, helping to
push coal, gas, and oil out of the picture.
Who’s Afraid Of The ESG?
ESG stands for the environmental, social, and governance goals that
are becoming familiar practice among leading corporations in the US
and elsewhere. Though the potential for greenwashing (and
social-washing) exists, ESG principles are intended to help businesses
quantify the bottom line benefits of long term sustainability goals as
well as best practices for employee recruitment and community
relations.
ESG principles can also motivate businesses to coalesce around public
policies that support renewable energy and other new clean
technologies. As part of the pushback, the anti-ESG movement claims
that banks and other financial firms pose a threat to public pension
plans when they focus on decarbonization.
Green Hydrogen Revolution Brewing In Texas
Officials in two dozen states have been actively promoting anti-ESG
policies, either through investigations or lawsuits brought (or
threatened) by their attorneys general, or through new laws aimed at
preventing the flow of investor dollars into clean technologies. The
funny thing is that officials in many of those same states have also
been pushing to attract new clean tech businesses to their borders.
Texas is only one such example, but it is a big one. State Attorney
General Ken Paxton is participating in a multi-state lawsuit aimed at
thwarting ESG investment, and in 2021 Governor Gregg Abbott authorized
a new law that specifically protects fossil energy industries from
competition.
Meanwhile, though, Abbott is among those cheering the arrival of a
new, $4 billion green hydrogen operation under the wing of the
companies Air Products and AES Corporation, to be located on the site
of a former coal power plant in Wilbarger County.
Billed as the biggest green hydrogen facility in the US, the project
is expected to push $500 million into the state’s economy over its
lifetime.
“This project will not only bring hundreds of jobs and millions in
revenue to the Lone Star State, but will also expand our state’s
robust energy sector and further solidify Texas as a global powerhouse
in this critical industry,” Abbott enthused in a press statement last
December.
The Governor’s office further notes that the project will “broaden
Texas’ energy portfolio and will position our state as the country’s
leader in green hydrogen while helping to reduce emissions,” which is
the long way around to saying that green hydrogen — meaning hydrogen
produced from water with the help of electricity from renewable energy
— will help push petroleum fuels out of the transportation market.
“The facility is targeted to begin commercial operations in 2027 and
will primarily serve mobility and other industrial markets,” is how
the Governor’s office puts it.
Why Texas Hearts Green Hydrogen
Don’t just take Abbott’s word for it. In March, Glen Hamer, CEO of the
Texas Association of Business, penned an op-ed for the Rio Grande
Guardian in which he credited Abbott and other state officials for
setting up Texas as a national green hydrogen leader.
“This is the best possible outcome for the people of Texas and our
state’s economy, because when businesses choose Texas, everyone wins,”
Hamer wrote.
“The burgeoning green hydrogen industry is increasingly focused on
clean mobility applications, including trucking, as well as other
industrial markets,” Hamer explained. “Demand is increasing in these
legacy Texas industries for solutions that help ensure compliance with
federal regulations fast-tracking decarbonization without sacrificing
reliability, affordability, or output.”
“Now, thanks to this new proposed facility, Texas businesses are able
to find a solution right in their own backyard,” he emphasized.
Hamer also mentioned something about needing the right “tax and
regulatory model” to help propel the green hydrogen industry in Texas.
That’s probably a veiled pitch for supporting the stacked tax
incentives outlined in the federal Inflation Reduction Act of 2022.
Our friends over at S&P Global are among those noting that the IRA
provides enough support to push green hydrogen over the
cost-competitive bar.
Whatever Happened To The Epicenter Of The Global Fossil Fuel Industry?
The enthusiasm for green hydrogen in Texas may seem off-kilter, given
the state’s reputation as an epicenter of the global fossil energy
industry. However, the state’s innovator-friendly regulatory
environment did enable Texas to leap into the forefront of the US wind
industry in the early 2000’s, thanks in part to the massive new CREZ
transmission project, commissioned in 2013.
The state’s solar industry is also beginning to stir into life,
including rooftop solar as well as utility scale solar power plants.
The Air Products/AES green hydrogen hub in will reportedly deploy both
wind and solar power, and there could be plenty more in store. In
January of 2021, while the dust was still settling over the failed
insurrection at the US Capitol, energy stakeholders were already
laying plans for a multi-input green hydrogen network in Texas. In
addition to electrolysis systems running on wind and solar power, the
network would include landfill biogas, from which hydrogen could be
extracted through a conventional steam reformation process.
If all goes according to plan, an additional non-fossil hydrogen
system could also be part of the picture. Last week, the hydrogen
startup Utility Global announced that it is expanding its footprint in
Texas. The company deploys a solid oxide system to extract hydrogen
from industrial waste gases.
In that context, it’s worth noting that hydrogen is ubiquitous
throughout modern industrialized economies. The primary source of
hydrogen today is natural gas, with coal playing a significant but
lesser role.
Hydrogen fuel cell cars have not gained much traction in the US, but
fuel is only one use case. Whether it’s green hydrogen from
electrolysis, or hydrogen recovered from waste gas, non-fossil
hydrogen will both help cut the carbon footprint of fertilizer
production as well as pharmaceuticals, food processing and personal
care items among other industries.
Another emerging market for non-fossil hydrogen is the electrofuels
industry, which deploys hydrogen and captured carbon to produce
synthetic liquid fuels and other industrial chemicals. Texas is
already beginning to attract e-fuels startups.
If Texas officials are serious about grabbing the lead on green
hydrogen production in the US, they better act fast. Other states are
competing for a share of the Energy Department’s $8 billion hydrogen
hub program, including a massive multi-state hydrogen initiative
combining the transportation and renewable energy resources of New
York, New Jersey, Connecticut, Massachusetts, Maine and Rhode Island.
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Photo: Green hydrogen facility courtesy of AES.
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