Houston energy expert discusses why hydrogen still has a future

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Scott Nyquist discusses why hydrogen may be down, but not out. Photo via UH.edu

Not long ago, hydrogen was hailed as the next big thing in clean energy. Investors poured in, and countries from Japan to Germany built ambitious hydrogen strategies. It wasn’t a new discovery; hydrogen has been used for over a century in refineries and fertilizers, but it suddenly found itself reborn as the world began working toward decarbonization.

When hydrogen burns, the only byproduct is water. Green hydrogen, produced with renewable power, could replace fossil fuels in everything from trucks to ships to steel mills. But the momentum has cooled. Costs remain stubbornly high, several projects have been delayed or canceled, and policy support has wavered. In the U.S., a change in administration has created uncertainty. In Europe, some governments are slowing funding or revising hydrogen mandates. Even the International Maritime Organization (IMO) recently postponed a key vote on fuel-carbon standards.

Yet as Mike Graff , former Chairman and CEO of American Air Liquide, said in an Energy Forum episode with Ed Emmett at Rice University’s Baker Institute, “The world is always looking to make sure that energy is first available, it’s affordable, and then it’s clean. And I see hydrogen over time evolving in that manner.” He also noted that “companies have produced hydrogen and utilized hydrogen for over 100 years, and they’ve done that very safely… I think we can continue that moving forward.”

China has doubled down on hydrogen as part of its industrial strategy, building massive electrolyzer manufacturing capacity and funding dozens of pilot projects across transportation and heavy industry. Japan and South Korea also stand out as examples of how sustained policy support can drive hydrogen progress.

Where Hydrogen Fits Today

To understand hydrogen’s role now, it helps to remember what it actually does. About 76 percent of global hydrogen is produced from natural gas and used in refineries, fertilizer plants, and chemical production. This so-called “gray hydrogen” is essential but carbon-intensive.

What’s new is the rise of low-carbon hydrogen, “blue” hydrogen made from natural gas with carbon capture, and “green” hydrogen produced by splitting water with renewable electricity. These methods are expensive, but they’re growing. According to the International Energy Agency, global low-emissions hydrogen output rose about 10 percent in 2024.

Hydrogen is also expanding beyond industry. As Graff explained, it already powers thousands of forklifts in warehouses across the U.S. and is beginning to appear in commercial trucking, locomotives, and even aviation prototypes. “You can now drive 600 to 800 miles on a hydrogen fuel-cell truck,” he noted, “and refuel in 30 minutes, just like you would refill for diesel.”

The Cost Challenge and a Gulf Coast Opportunity

So why the slowdown? One word: economics.

Even with generous tax credits, green hydrogen can cost two to three times more than conventional fuels. Electrolyzers are still expensive, though costs are falling as Chinese suppliers introduce low-cost alternatives.

Infrastructure is another hurdle. Pipelines, storage, and fueling networks need to be built from scratch.

But those same challenges point to opportunity, especially along the U.S. Gulf Coast. The region already has one of the world’s largest hydrogen pipeline systems and a well-established energy infrastructure. Texas, in particular, has a head start. It already hosts nearly 1,000 miles of hydrogen pipelines, about 64 percent of the U.S. total, and some of the world’s largest hydrogen storage sites at Moss Bluff, Spindletop, and Clemens. Out of 140 hydrogen plants operating nationwide, 43 are in Texas, supported by extensive refining and natural gas infrastructure. This combination of assets gives the Gulf Coast an unmatched foundation to scale low-carbon hydrogen and integrate production, storage, and end use across industries.

As Ken Medlock , Senior Director of the Center for Energy Studies at Rice University’s Baker Institute, explains in his report: Developing a Robust Hydrogen Market in Texas, Texas has all the critical elements needed to lead in a low-carbon hydrogen economy, including existing infrastructure, a skilled workforce, and proximity to industrial demand centers. That combination gives it a distinct advantage in scaling up hydrogen production and use.

Governments around the world are showing renewed confidence in hydrogen. The European Commission awarded nearly €3 billion to 13 major projects, while Japan and South Korea continue expanding fueling networks. China is leading one of the most ambitious buildouts, with more than 50 planned hydrogen projects and a rapidly growing fleet of fuel-cell vehicles. Despite recent setbacks, global investment has surpassed $100 billion, and projects in places such as Chile, where strong renewables and low-cost Chinese equipment help make projects feasible, are moving toward final investment decisions.

What Comes Next

Hydrogen’s future won’t depend on replacing every fuel, but on filling the gaps where batteries and biofuels fall short.

Transportation: This is where momentum is strongest today. Batteries dominate cars, but hydrogen fuel cells excel in heavy trucks, ships, and planes. As Graff noted, “You can design a commercial vehicle with the same utility as diesel but powered by hydrogen.” Airbus and Boeing are testing hydrogen propulsion concepts, and several ports are experimenting with hydrogen bunkering for cargo ships.

Industry: Steel, cement, and chemicals account for a quarter of global emissions. Hydrogen-based direct-reduced-iron (DRI) steelmaking is being piloted in Europe and Asia and could transform how these materials are produced at scale.

Storage: Hydrogen can store energy for days or weeks, serving as backup for renewables like wind and solar. But storage remains very costly and may only prove viable for the “last mile” of greenhouse gas reduction or grid stability.

These uses may sound niche, but that’s how technologies scale. They start small, gain an economic foothold, and expand as costs decline.

Conclusion

Hydrogen's early, perhaps irrational, exuberance may have cooled, but amidst the rubble of cancelled projects are the beginnings of an industry that could play a vital niche role on the journey towards a lower carbon intensity energy future. As costs fall and infrastructure around the world expands, hydrogen's role will expand into the nooks and crannies of the energy industry.

It won't replace every fuel, but it doesn't have to. Success will come from steady, project-by-project progress.

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Scott Nyquist is a senior advisor at McKinsey & Company and vice chairman, Houston Energy Transition Initiative of the Greater Houston Partnership. The views expressed herein are Nyquist's own and not those of McKinsey & Company or of the Greater Houston Partnership. This article originally appeared on LinkedIn.

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Houston biotech company Gold H2's proprietary biotechnology has generated hydrogen from depleted oil reservoirs in a California field trial. Photo courtesy Gold H2.

Gold H2 harvests clean hydrogen from depleted California reservoirs in first field trial

breakthrough trial

Houston climatech company Gold H2 completed its first field trial that demonstrates subsurface bio-stimulated hydrogen production, which leverages microbiology and existing infrastructure to produce clean hydrogen.

Gold H2 is a spinoff of another Houston biotech company, Cemvita.

“When we compare our tech to the rest of the stack, I think we blow the competition out of the water," Prabhdeep Singh Sekhon, CEO of Gold H2 Sekhon previously told Energy Capital.

The project represented the first-of-its-kind application of Gold H2’s proprietary biotechnology, which generates hydrogen from depleted oil reservoirs, eliminating the need for new drilling, electrolysis or energy-intensive surface facilities. The Woodlands-based ChampionX LLC served as the oilfield services provider, and the trial was conducted in an oilfield in California’s San Joaquin Basin.

According to the company, Gold H2’s technology could yield up to 250 billion kilograms of low-carbon hydrogen, which is estimated to provide enough clean power to Los Angeles for over 50 years and avoid roughly 1 billion metric tons of CO2 equivalent.

“This field trial is tangible proof. We’ve taken a climate liability and turned it into a scalable, low-cost hydrogen solution,” Sekhon said in a news release. “It’s a new blueprint for decarbonization, built for speed, affordability, and global impact.”

Highlights of the trial include:

First-ever demonstration of biologically stimulated hydrogen generation at commercial field scale with unprecedented results of 40 percent H2 in the gas stream.
Demonstrated how end-of-life oilfield liabilities can be repurposed into hydrogen-producing assets.
The trial achieved 400,000 ppm of hydrogen in produced gases, which, according to the company,y is an “unprecedented concentration for a huff-and-puff style operation and a strong indicator of just how robust the process can perform under real-world conditions.”
The field trial marked readiness for commercial deployment with targeted hydrogen production costs below $0.50/kg.

“This breakthrough isn’t just a step forward, it’s a leap toward climate impact at scale,” Jillian Evanko, CEO and president at Chart Industries Inc., Gold H2 investor and advisor, added in the release. “By turning depleted oil fields into clean hydrogen generators, Gold H2 has provided a roadmap to produce low-cost, low-carbon energy using the very infrastructure that powered the last century. This changes the game for how the world can decarbonize heavy industry, power grids, and economies, faster and more affordably than we ever thought possible.”

A new study from the University of Texas at Austin shows that new hydrogen production facilities could account for 2 percent to nearly 7 percent of the state's water demand by 2050. Photo via Getty Images.

Hydrogen industry could have major impact on Texas water resources, study says

water works

Just as the data center industry thrives on electricity, the hydrogen industry thrives on water.

A new study from researchers at the University of Texas at Austin found that by 2050, new hydrogen production facilities could account for 2 percent to nearly 7 percent of water demand in the state. The impact could be especially dramatic along the Gulf Coast, where most of the state’s hydrogen production facilities are already built or are being planned.

The research was published in the journal Sustainability.

The study reported that "most existing and proposed hydrogen production infrastructures are within projected water-strained cities and counties, such as Houston in Harris County and Corpus Christi in Nueces County."

Compared with municipal water supplies or irrigation systems, the hydrogen industry’s demand for water is comparatively small, the study’s lead author, Ning Lin, an energy economist at UT’s Bureau of Economic Geology, said in a news release. But hydrogen-fueled demand could strain communities that already are grappling with current and future water shortages.

“Where you put a project can make a huge difference locally,” Lin says. “With multiple hydrogen facilities planned in water-stressed Gulf Coast counties, this study highlights the urgent need for integrated water and energy planning and provides a solid foundation to help policymakers, industry, and communities make informed decisions about hydrogen and water management.”

To forecast water demand, Lin and her colleagues crunched data from a 2024 National Petroleum Council study that estimated the regional hydrogen demand from 2030 to 2050 based on two energy policy scenarios.

As part of the study, researchers reviewed water use and water quality for various hydrogen production methods that affect whether water remaining from production can be recycled.

“In order to plan for water needs, somebody has to figure out what those future demands might look like, and this paper puts some numbers to (it) that, I think, will be very helpful,” Robert Mace, executive director of the Meadows Center for Water and the Environment at Texas State University, who was not part of the study, added in the release.

Researchers created a light-driven catalyst for hydrogen production, offering an emission-free alternative to traditional methods. Photo by Jeff Fitlow/Rice University

Houston researchers develop catalyst for emission-free hydrogen production using light instead of heat

switch flipped

Researchers at Rice University have developed a catalyst that could render steam methane reforming, or SMR, entirely emission-free by using light rather than heat to drive the reaction.

The researchers believe the work could prove to be a breakthrough for extending catalyst lifetimes. This will improve efficiencies and reduce costs for a number of industrial processes that are affected by a form of carbon buildup that can deactivate catalysts called coking.

The new copper-rhodium photocatalyst uses an antenna-reactor design. When it is exposed to a specific wavelength of light it breaks down methane and water vapor without external heating into hydrogen and carbon monoxide. The importance of this is it is a chemical industry feedstock that is not a greenhouse gas. Rice’s work also shows that the antenna-reactor technology can overcome catalyst deactivation due to oxidation and coking by employing hot carriers to remove oxygen species and carbon deposits, which effectively regenerates the catalyst with light.

The new SMR reaction pathway build off a 2011 discovery from Peter Nordlander, Rice’s Wiess Chair and Professor of Physics and Astronomy and professor of electrical and computer engineering and materials science and nanoengineering, and Naomi Halas. They are the authors on the study about the research that was published in Nature Catalysis. The study showed that the collective oscillations of electrons that occur when metal nanoparticles are exposed to light can emit “hot carriers” or high-energy electrons and holes that can be used to drive chemical reactions.

“This is one of our most impactful findings so far, because it offers an improved alternative to what is arguably the most important chemical reaction for modern society,” Norlander says in a news release.

The research was supported by Robert A. Welch Foundation (C-1220, C-1222) and the Air Force Office of Scientific Research (FA9550-15-1-0022) with the Shared Equipment Authority at Rice providing data analysis support.

“This research showcases the potential for innovative photochemistry to reshape critical industrial processes, moving us closer to an environmentally sustainable energy future,” Halas adds.

Hydrogen has been studied as it could assist with the transition to a sustainable energy ecosystem, but the chemical process responsible for more than half of the current global hydrogen production is a substantial source of greenhouse gas emissions.Hydrogen is produced in large facilities that require the gas to be transported to its point of use. Light-driven SMR allows for on-demand hydrogen generation,which researchers believe is a key benefit for use in mobility-related applications like hydrogen fueling stations or and possibly vehicles.

The facility, once completed, will be able to produce 165 kilo tons per Annum of hydrogen and 5,000 metric tons per day of ammonia. Photo via Getty Images

Houston company scores agreement to work on Canadian green hydrogen project

contract secured

Houston-headquartered McDermott has reported that it secured an agreement to work on Canada's first commercial green hydrogen and ammonia production facility.

The Early Contractor Involvement agreement is from Abraxas Power Corp. to work on the Exploits Valley Renewable Energy Corporation (EVREC) project located in Central Newfoundland and will include developing a wind farm with up to 530 turbines that will have the ability to generate 3.5 gigawatts of electricity and 150 megawatts solar photo voltaic. Additionally, the facility, once completed, will be able to produce 165 kilo tons per Annum of hydrogen and 5,000 metric tons per day of ammonia.

"The agreement is testament to McDermott's industry-leading delivery and installation expertise, and the breadth of our capabilities across the energy transition," Rob Shaul, McDermott's senior vice president, Low Carbon Solutions, says in a news release. "Our century of experience, from concept to completion, and integrated delivery model, means we can offer Abraxas a repeatable modular implementation solution that is expected to drive cost savings, reduce risk and provide quality assurance."

Per the agreement, the company will provide front-end engineering design, engineering, procurement, and construction execution planning services, and more for the project. According to McDermott, the company's contribution to the project will be led from McDermott's Houston office with support from its office in India.

Recently, another collaboration McDermott is working on reached a new milestone. Houston-based Element Fuels has completed the pre-construction phase of its hydrogen-powered clean fuels refinery and combined-cycle power plant in the Port of Brownsville. McDermott is providing front-end engineering design services for the project.

In October, McDermott announced that it signed a lighthouse agreement with United Kingdom-based industrial software company AVEVA and Massachusetts-based product lifecycle management platform provider Aras. With the new software, McDermott plans "to develop its asset lifecycle management capability across the energy transition, oil and gas, and nuclear sectors," per the news release.

Overall, the project is one of the largest collections of renewable hydrogen production, onsite storage, and end-use technologies that are all located at the same site. Photo via utexas.edu

Texas hydrogen research hub brings on new corporate partner

howdy, partner

A Texas US Department of Energy initiative has added a new corporate player.

Hitachi Energy has joined the DOE's H2@Scale in Texas and Beyond initiative with GTI Energy, Frontier Energy, The University of Texas Austin, and others. The initiative, which opened earlier this year, plans to assist in “integrating utility-scale renewable energy sources with power grids and managing and orchestrating a variety of energy sources” according to a news release.

Most of the ‘H2@Scale project’s activities take place at University of Texas JJ Pickle Research Center in Austin. The project is part of a larger one to expand hydrogen’s role and help to decarbonize Texas. The ‘H2@Scale' project consists of multiple hydrogen production options like a vehicle refueling station alongside a fleet of hydrogen fuel cell vehicles.

Overall, the project is one of the largest collections of renewable hydrogen production, onsite storage, and end-use technologies that are all located at the same site.

Another larger goal is to investigate the efficiency and cost-effectiveness of hydrogen generation from renewable resources, which all aligns with the project’s vision of decarbonization efforts.

Hitachi Energy is part of the full hydrogen value chain from early-stage project origination and design. They also work to ensure grid compliance, power conversion systems and asset management solutions.

“Hitachi Energy is proud to be a key partner in the US Department of Energy’s ‘H2@Scale in Texas and Beyond’ project. The initiative comes at a pivotal moment in our commitment to advancing hydrogen production and its role in the evolving clean energy landscape,” Executive Vice President and Region Head of North America at Hitachi Energy Anthony Allard says in a news release. “As hydrogen emerges as a critical element in decarbonizing hard-to-abate industries, Hitachi Energy remains dedicated to drive innovation and sustainability on a global scale.”

Hitachi’s project teams will undertake feasibility studies for scaling up hydrogen production and use, which will aim to benefit the development of a strategic plan and implementation of the H2@Scale project in the Port of Houston and the region of the Gulf Coast. The teams will also seek opportunities to leverage prospective hydrogen users, pre-existing hydrogen pipelines, and large networks of concentrated industrial infrastructure. Then, they will work to identify environmental and economic benefits of hydrogen deployment in the area.

Earlier this year, Hitachi Energy teamed up with teamed up with Houston-based electrical transmission developer Grid United for a collaboration to work on high-voltage direct current technology for Grid United transmission projects. These projects will aim to interconnect the eastern and western regional power grids in the U.S. The Eastern Interconnection east of the Rocky Mountains, the Western Interconnection west of the Rockies and the Texas Interconnection run by the Electric Reliability Council of Texas, make up the three main power grids.

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Tesla, Houston City College to receive millions for workforce training

texas talent

Gov. Greg Abbott announced $1.73 million in workforce training grants for the Houston and Rio Grande Valley regions late last month, with the bulk of the funding heading toward Houston.

The funding comes through the Skills Development Fund (SDF) grant program from the Texas Workforce Commission. The grants will help train 689 current and new workers in technology, manufacturing, technology, logistics and other fields in high demand.

Three grants totaling $1.56 million will go to Houston City College to develop training programs for 602 Houston-area workers.

The largest grant, totaling $782,998, will go toward training 261 employees for Tesla Inc. as welders, maintenance technicians, process technicians and other jobs. In addition to Tesla’s $200 million megafactory in Brookshire, Texas, the electric vehicle company is also considering building a $10.1 billion solar cell manufacturing facility in Fort Bend County called Project Sun City. The company recently expanded its self-driving Robotaxi service throughout 610 Loop and northwest Houston.

A second grant of $690,044 will go toward training 300 workers at Texas Tissue LLC and Karsten Management LLC as frontline supervisors, production line operators, design specialists and maintenance technicians. An allocation of $83,963 will go toward training 41 workers at Watchfire Signs LLC as production supervisors, operations specialists, industrial maintenance technicians, and more.

According to HCC, its Corporate Training and Development will coordinate the program in partnership with the college’s Advanced Manufacturing Center of Excellence Southwest and the Material Science Center of Excellence Welding Department.

“These grants demonstrate how state agencies, employers and Houston City College can work together to meet evolving workforce needs, strengthen Texas businesses and create meaningful opportunities for workers,” HCC Chancellor Margaret Ford Fisher said in a news release.

TWC granted an additional $169,087 to Workforce Solutions Lower Rio Grande Valley to train 87 workers at Denso Ten America Limited, Alps Logistics (USA) Inc., Index Fresh Inc. and Emerson Electric Co.

“When we align local training directly with the needs of expanding industries, we strengthen the regional economy,” TWC Chairman Joe Esparza said in the news release. “These Skills Development Fund grants empower Houston City College and Workforce Solutions Lower Rio Grande Valley to provide the specialized, high-demand training that employers need to succeed right here in Texas.”

Texas A&M wins $5.4M DOE grant for advanced nuclear fuel research

fresh funding

The U.S. Department of Energy has awarded Texas A&M Engineering Experiment Station (TEES) a $5.4 million grant to research ways to turn nuclear waste into fuel.

The goal of the project, “Turning Nuclear Waste into Fuel with a Thorium Molten Salt Reactor,” is to develop innovative reactor fuel technology that could help transform long-lived nuclear waste into a valuable energy resource while advancing the future of nuclear power, according to Texas A&M.

Lin Shao, a Texas A&M professor of nuclear engineering, will lead the project and unite researchers from TEES, Savannah River National Laboratory and Abilene, Texas-based nuclear power company Natura Resources. The team will use experimental testing, fuel preparation, reactor design and computational modeling in their work.

“Texas A&M Engineering is honored to receive this support from the Department of Energy to advance groundbreaking nuclear energy technologies,” Robert H. Bishop, vice chancellor and dean of Texas A&M Engineering and director of TEES, said in a news release. “This research aligns directly with our mission to solve the nation’s most pressing engineering challenges through innovation and collaboration. We have an opportunity to develop solutions that reduce nuclear waste, improve energy reliability and help maintain American leadership in advanced nuclear technologies.”

Texas A&M’s award is part of the DOE's Advanced Research Projects Agency-Energy (ARPA-E) $50 million advancement for next-generation nuclear fuels through the High-performance Optimized Recycled Nuclear Isotopes for Gen IV reactors (HORNIG) program. Texas A&M was one of eight projects selected as part of the ARPA-E efforts.

“America’s energy future depends on bold innovation and strong partnerships between the federal government, national laboratories, universities and industry,” U.S. Deputy Secretary of Energy James P. Danly said when he awarded the grant on campus Oct. 29. “This project demonstrates how we can address long-term nuclear waste challenges while advancing technologies that strengthen our nation’s energy security. The Department of Energy is proud to support research that has the potential to unlock new value from existing nuclear materials and accelerate the deployment of advanced reactor systems.”

Zero-emission electric air taxi network to land in Texas in 2027

Electric Travel

San Jose, California-based aerospace company Archer Aviation is bringing its air-taxi system to the “Texas triangle” of Houston, Austin and Dallas-Fort Worth.

Currently, the planned zero-emission electric air taxi networks will use Archer’s Midnight air taxi to “turn 60- to 90-minute drives to major airports, business districts and major destinations into 10- to 20-minute flights,” the company said in a news release. Archer plans to begin flights in the Texas triangle next year.

The Midnight air taxi is an all-electric vertical takeoff and landing (eVTOL) aircraft. It can carry four passengers and a pilot and is designed for consecutive flights of about 20 miles.

Archer cites the Texas triangle as one of the busiest and fastest-growing “megaregions” in the country due to its proximity to coastal regions, major airports, and a number of business districts.

Archer Chief Commercial Officer Nikhil Goel described the air taxi experience to CW Houston as “100 times quieter than a helicopter for the price of an Uber Black.” He added that the air taxis are a combination of a helicopter, a small airplane and a drone.

In Houston, Archer’s air taxi network will aim to connect George Bush Intercontinental, William P. Hobby and Sugar Land Regional Airport with downtown destinations, including the Thompson Hotel helipad, and Galveston.

In Austin, it plans to link the city's Austin-Bergstrom International Airport and Austin Executive Airport with the F1 Circuit Helipad at the Circuit of the Americas. Archer debuted its Midnight aircraft at the F1 Prix in the Fan Zone and the F1 Paddock at Austin’s COTA.

The Dallas-Fort Worth network is slated to include Dallas-Fort Worth International Airport, Dallas Love Field, Addison Airport, Arlington Municipal Airport, Fort Worth Meacham International Airport and Perot Field Fort Worth Alliance Airport, plus major business hubs like Frisco Station.

“Texas is setting the bar for America’s leadership in the next generation of aviation,” Adam Goldstein, founder and CEO of Archer Aviation, said in the release. “Our planned networks will make the benefits of electric air taxis real for Texans — trading hours in traffic for minutes in the air, while connecting the biggest airports, business districts and sporting hubs in ways that America’s largest megaregion needs to grow.”

Archer is working with state and local partners to develop charging infrastructure and plans to pursue Texas operations through the White House’s eVTOL Integration Pilot Program, according to the release. It recently completed its "No Roads" flight tour, which included multiple flights over the San Francisco Bay, and flew to seven cities over three days.

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This article first appeared on InnovationMap.com.

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