Pennsylvania partnering with public and private sector to decarbonize industry and manufacturing sectors
The Wolf Administration announced Thursday the next steps taken by the commonwealth to achieve Governor Tom Wolf’s goal to ensure Pennsylvania secures at least one spot as one of the nation’s Regional Clean Hydrogen Hubs to lead industrial sector decarbonization, with a focus on heavy manufacturing. In partnership with Team Pennsylvania, the commonwealth submitted a concept paper to the U.S. Department of Energy to establish an H2Hub known as the Decarbonization Network of Appalachia (DNA H2Hub) focused on industrial and manufacturing decarbonization.
“Pennsylvania is excited to be taking this critical step towards becoming part of a DOE-funded H2Hub,” said Acting Secretary of Community and Economic Development Neil Weaver. “This proposed partnership represents a unique opportunity to advance our goals for reducing greenhouse gas emissions while growing our economy through deploying the next generation of energy and industrial infrastructure in the state.”
Appalachia has long played an important role in energy production and manufacturing in the United States. The region has evolved from being the site of the country’s first oil production wells to the source of abundant coal power, the birthplace of commercial nuclear electricity and now into extensive natural gas production. The region remains the center of steel, plastics, and refining production in the US, and has a robust supply chain for the automotive industry.
“Pennsylvania’s historical strengths in energy and industrial productivity mean that we are well-positioned to lead the energy transition towards deep decarbonization,” said Abby Smith, Team Pennsylvania Foundation President & CEO. “And Team Pennsylvania’s ability to accelerate economic growth through public-private partnership will be leveraged to support an application for a hydrogen hub that will keep Pennsylvania economically competitive for generations to come.”
The DNA H2Hub concept submitted to the Department of Energy is the next step in the process to be considered for one of at least six Regional Clean Hydrogen Hubs eligible for $8 billion through the Bipartisan Infrastructure Law to expand the use of clean hydrogen in the industrial sector. Team Pennsylvania will serve as lead applicant, while partners Equinor and Shell USA will oversee technical and commercial delivery of the project. A Project Advisory Board including DCED and public sector partners will provide project leadership in conjunction with Team PA. If selected, the DNA H2Hub will establish a large low-CO2 infrastructure network through the emissions intensive tri-state region, providing a pathway to widescale emission reductions in hard to decarbonize industries including steel-making and manufacturing.
In order to position Pennsylvania to take advantage of this DOE funding opportunity, last week, Governor Wolf signed House Bill 1059 which established a $50 million per year H2 tax credit specifically for a manufacturing facility that is part of a Regional Clean Hydrogen Hub as designated by the Department of Energy. This investment is just one more signal of the serious commitment Governor Wolf has made to a clean energy future and economic success for the commonwealth.
In addition to the Team PA DNA proposal, the administration is supportive of a proposal led by the City of Philadelphia and partners, called the Mid-Atlantic Clean Hydrogen Hub (MACH2). Building off the legacy of petroleum refinement and chemical production in the Mid-Atlantic, the MACH2 proposal will leverage the wealth of existing technology and infrastructure in the region to generate clean hydrogen, and reuse and revitalize existing pipeline infrastructure. If funded, MACH2 is expected to support a just energy transition by creating or retaining more than an estimated 20,000 well-paying jobs through re-training, up-skilling and talent pipeline building, and providing economic opportunities as well as health improvements that directly benefit historically underserved communities in Southeast PA, Delaware, and Southern New Jersey.
The Wolf Administration will continue working with its public and private sector partners to collaboratively pursue this once-in-a-generation opportunity for an energy economy transformation.