Clean hydrogen can fuel industrial decarbonization and environmental justice

Among the myriad clean energy proposals in President Biden’s American Jobs Plan was one that received little attention, but which could have enormous implications for both reaching net-zero emissions and for environmental justice: a proposal for hydrogen demonstration projects as part of building “next-generation industries in distressed communities.”

Hype around hydrogen has been driven by its unique decarbonizing applications and economic potential, but its ability to advance environmental justice has been overlooked. As the administration pushes for “40 percent of overall benefits” of federal investments into energy and transit to “flow to disadvantaged communities,” it should tap into hydrogen’s potential to drive economic development and eliminate emissions from the industries most responsible for the pollution that burdens marginalized communities — namely, transportation and heavy industry.

The transportation sector accounts for more than one-quarter of U.S. greenhouse gas emissions. Heavy-duty vehicles, which hydrogen is particularly well-suited to decarbonize, also emit criteria air pollutants (CAP), including nitrogen oxides (NOx), particulate matter (PM) and carbon monoxide (CO), that cause thousands of premature deaths each year. Fuel cell electric vehicles (FCEVs) fueled with clean hydrogen would produce zero tailpipe emissions, eliminating those emissions. 

In marginalized communities, hydrogen substitution can thus yield enormous benefits for local health, economic growth and the country’s overall push to decarbonize.

California has been a leader in hydrogen adoption in the transport sector, with over 44 hydrogen fueling stations and goals for hydrogen deployment, including its target of 300,000 hydrogen-powered medium- and heavy-duty commercial trucks by 2035. California Climate Investments recently unveiled a fleet of hydrogen semi-trucks for use in the Port of Los Angeles, a substitution that can have enormous decarbonization benefits: One heavy-duty diesel truck emits 105.4 metric tons of CO2 per year. 

Extending that pilot to other shipping hubs can yield enormous air quality and decarbonization benefits for marginalized communities. Take Houston, Texas: the country’s third-most valuable trade corridor and eighth most traffic-congested city. Pollution from the sector has had significant impacts on air quality and health: The city surpasses national averages across PM, ozone, Diesel PM and air respiratory toxicity by between 5 and 14 percent. Houston also has large Black and Latino populations and these communities are particularly vulnerable to emissions’ health impacts.

In addition to transportation, decarbonizing heavy industry — particularly steel — offers an opportunity to deploy hydrogen to both drive decarbonization and advance environmental justice. Steel production is the third-largest industrial emitter in the world and contributes about 6 percent of global CO2 emissions. Production also emits pollutants such as CO, sulfur oxides, NOx and PM, while populations near steel mills face heightened risks of lung cancer and mortality from long-term exposure.

Substituting hydrogen into production — one of the industry’s only decarbonization pathways — can reduce emissions by 21.4 percent alone, a reduction that could rise to 60 percent depending upon production processes. In Europe, industry leaders and investors have launched the H2 Green Steel initiative to produce millions of tons of green steel annually by 2024.

In the United States, steel production is concentrated in the Midwest, and Indiana has the most toxic pollution per square mile, largely attributable to steel production. Gary, Indiana is one community that is reliant on steel production but suffers from its environmental impacts. The city is over 78 percent black and ranks above national averages in PM, Ozone, diesel PM and air respiratory toxicity by 8 to 14 percent. Substituting hydrogen in places like Gary would provide enormous environmental justice and decarbonization benefits and contribute to their economic growth.

Clean hydrogen can thus play a key role not only in the U.S. energy transition, particularly in hard-to-abate sectors, but also in environmental justice efforts. The American Jobs Plan recognizes that potential, and hydrogen demonstration projects in marginalized communities would be a critical first step.

A complementary production tax credit — as recently proposed by Sen. Tom Carper (D-Del.) — will also be critical to producing enough hydrogen to supply hydrogen projects across the country.

But ambitions should not stop there. Supporting hydrogen deployment in these communities prioritizes environmental justice, maximizes the community economic benefits of the projects, and drives decarbonization. Projects that advance each of these three goals — whether hydrogen projects or not, as hydrogen deployment should be concentrated in sectors with few alternatives — should be the priority of climate legislation and policies.

Congress should incentivize investment and project development through tax policy that supports clean technology deployment in distressed communities. Such policy could augment the Internal Revenue Service’s “opportunity zones” — a designation that incentivizes investment into economically distressed communities through tax credits and breaks — to specifically bolster decarbonization or environmental justice efforts.

Policymakers and companies must also ensure that the project’s benefits reach local communities. Community involvement can enhance the economic and environmental justice benefits of deployment by empowering — through employment opportunities and air quality improvement — rather than burdening these communities.

Hydrogen’s time may have finally arrived, but where and how it is deployed will determine its benefits, both economic and environmental. The Biden administration and Congress can make sure that its impact is maximized by using it to create a more just, equitable, and clean energy system.

David W. Yellen is an assistant director at the Atlantic Council Global Energy Center.

Maria Castillo is a former young global professional at the Atlantic Council Global Energy Center.