Houston's hydrogen revolution gets up to $1.2B federal boost to power Gulf Coast’s clean energy future

HyVelocity funding

The U.S. Department of Energy funding is earmarked for the new HyVelocity Hub. Photo via Getty Images

The emerging low-carbon hydrogen ecosystem in Houston and along the Texas Gulf Coast is getting as much as a $1.2 billion lift from the federal government.

The U.S. Department of Energy funding, announced November 20, is earmarked for the new HyVelocity Hub. The hub — backed by energy companies, schools, nonprofits, and other organizations — will serve the country’s biggest hydrogen-producing area. The region earns that status thanks to more than 1,000 miles of dedicated hydrogen pipelines and almost 50 hydrogen production plants.

“The HyVelocity Hub demonstrates the power of collaboration in catalyzing economic growth and creating value for communities as we build a regional hydrogen economy that delivers benefits to Gulf Coast communities,” says Paula Gant, president and CEO of Des Plaines, Illinois-based GTI Energy, which is administering the hub.

HyVelocity, which aims to become the largest hydrogen hub in the country, has already received about $22 million of the $1.2 billion in federal funding to kickstart the project.

Organizers of the hydrogen project include:

Arlington, Virginia-based AES Corp.
Air Liquide, whose U.S. headquarters is in Houston
Chevron, which is moving its headquarters to Houston
Spring-based ExxonMobil
Lake Mary, Florida-based Mitsubishi Power Americas
Denmark-based Ørsted
Center for Houston’s Future
Houston Advanced Research Center
University of Texas at Austin

The hub’s primary contractor is HyVelocity LLC. The company says the hub could reduce carbon dioxide emissions by up to seven million metric tons per year and create as many as 45,000 over the life of the project.

HyVelocity is looking at several locations in the Houston area and along the Gulf Coast for large-scale production of hydrogen. The process will rely on water from electrolysis along with natural gas from carbon capture and storage. To improve distribution and lower storage costs, the hub envisions creating a hydrogen pipeline system.

Clean hydrogen generated by the hub will help power fuel-cell electric trucks, factories, ammonia plants, refineries, petrochemical facilities, and marine fuel operations.

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Houston's HyVelocity Hub has joined in on a joint letter with the other six H2Hubs asking for revised guidelines. Photo via Getty Images

Houston's clean hydrogen hub joins request to revise federal tax credit guidance

edits needed

The group of regional hubs tapped by the United States government to receive funding to develop clean hydrogen projects have banded together to request a revision of the U.S. Department of Treasury's proposed hydrogen production tax credit (45V) guidance.

Houston's HyVelocity Hub, which was selected to receive up to $1.2 billion from the government's initiative, has joined in on a joint letter with the other six H2Hubs asking for revised requirements. HyVelocity also submitted its own letter to the Treasury.

HyVelocity's letter asks for flexibility and certainty the implementation of the “three pillars” for electricity, which include temporality, incrementality, and deliverability.

"It is imperative that to enable the desired environmental, economic, and equity goals of the IRA, private investment in hydrogen production must advance at scale and at an accelerated pace. Hydrogen production project investments require stable market projections and assurance of regulatory stability to ensure the economics of the long-term projects. To support this investment environment, we recommend that projects be granted a 'grandfathered exemption' such that for the project's life, they can use the regulations in place at the time when construction begins," reads the letter from HyVelocity.

HyVelocity, representing the Gulf Coast region, plans to create up to 35,000 construction jobs and 10,000 permanent jobs across nine proposed core projects with a collective investment of more than $10 billion in private capital to bring low-carbon hydrogen to the market.

The Houston-area initiative is backed by industry partners AES Corporation, Air Liquide, Chevron, ExxonMobil, Mitsubishi Power Americas, Ørsted, and Sempra Infrastructure and The spearheaded by GTI Energy and other organizing participants, including the University of Texas at Austin, The Center for Houston’s Future, Houston Advanced Research Center, and around 90 other supporting partners from academia, industry, government, and beyond.

Chevron New Energies now owns a majority share of the Advanced Clean Energy Storage project in Delta, Utah. Photo via Getty Images

Houston-headquartered Chevron subsidiary acquires majority stake in ongoing hydrogen project

M&A move

The Houston-based clean energy subsidiary of Chevron is making a big splash in the clean hydrogen sector. It just acquired a majority stake in what’s being promoted as the world’s largest facility for clean hydrogen storage.

Chevron New Energies bought Salt Lake City-based Magnum Development from Houston-based private equity firm Haddington Ventures. As a result, the New Energies unit now owns a majority share of the Advanced Clean Energy Storage (ACES) project in Delta, Utah. A joint venture of Magnum Development and Mitsubishi Power Americas is developing ACES. Financial terms weren’t disclosed.

“Having been the primary financial sponsor behind this key energy hub since 2008, we believe this transaction will accelerate lower-carbon-intensity solutions that reduce emissions in the western United States,” says John Strom, managing director of Haddington Ventures.

ACES plans to use electrolysis to convert renewable energy into hydrogen and store the energy in salt caverns. The first phase, designed to convert and store up to 100 metric tons of hydrogen per day, is under construction and expected to begin commercial-scale operations in mid-2025.

“Using salt caverns for seasonal energy storage is a significant opportunity to empower hydrogen as an energy carrier and greatly expand energy storage resources throughout the U.S.,” says ACES contractor WSP, an engineering, environmental and professional services consulting firm.

The hydrogen facility will support Intermountain Power Plant, a Utah power plant operated by the municipal utility in Los Angeles. The stored hydrogen is expected to fuel a hybrid 840-megawatt combined-cycle gas turbine (CCGT) power plant that’ll replace an 1,800-megawatt, coal-fired power plant.

A CCGT plant harnesses exhaust heat from natural gas turbines to generate steam through a heat recovery steam generator, according to IPIECA, an oil and gas association that focuses on environmental and social issues. The steam is then fed to a steam turbine to supply additional power.

Michael Ducker, senior vice president of hydrogen infrastructure at Mitsubishi Power, says the ACES project “will serve as a blueprint for future hydrogen opportunities.”

“We seek to leverage the unique strengths of each partner to develop a large-scale, hydrogen platform that provides affordable, reliable, ever-cleaner energy and helps our customers achieve their lower carbon goals,” says Austin Knight, vice president of hydrogen at Chevron New Energies.

Chevron New Energies is marketing its low-carbon hydrogen offering to sectors like transportation, power, and industrial. These sectors face especially big hurdles in their efforts to reduce greenhouse gas emissions.

In June 2022, the U.S. Department of Energy (DOE) issued a $504.4 million loan guarantee to finance ACES. The facility will combine 220 megawatts of alkaline electrolysis with two 4.5 million-barrel salt caverns for storage of clean hydrogen.

ACES expects to create up to 400 construction jobs and 25 permanent jobs.

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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.”

Rice University spinout lands $500K NSF grant to boost chip sustainability

cooler computing

HEXAspec, a spinout from Rice University's Liu Idea Lab for Innovation and Entrepreneurship, was recently awarded a $500,000 National Science Foundation Partnership for Innovation grant.

The team says it will use the funding to continue enhancing semiconductor chips’ thermal conductivity to boost computing power. According to a release from Rice, HEXAspec has developed breakthrough inorganic fillers that allow graphic processing units (GPUs) to use less water and electricity and generate less heat.

The technology has major implications for the future of computing with AI sustainably.

“With the huge scale of investment in new computing infrastructure, the problem of managing the heat produced by these GPUs and semiconductors has grown exponentially. We’re excited to use this award to further our material to meet the needs of existing and emerging industry partners and unlock a new era of computing,” HEXAspec co-founder Tianshu Zhai said in the release.

HEXAspec was founded by Zhai and Chen-Yang Lin, who both participated in the Rice Innovation Fellows program. A third co-founder, Jing Zhang, also worked as a postdoctoral researcher and a research scientist at Rice, according to HEXAspec's website.

The HEXASpec team won the Liu Idea Lab for Innovation and Entrepreneurship's H. Albert Napier Rice Launch Challenge in 2024. More recently, it also won this year's Energy Venture Day and Pitch Competition during CERAWeek in the TEX-E student track, taking home $25,000.

"The grant from the NSF is a game-changer, accelerating the path to market for this transformative technology," Kyle Judah, executive director of Lilie, added in the release.

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This article originally ran on InnovationMap.

Houston renewable energy retailer expands nationally and more news to know

Trending News

Editor's note: The top Houston energy transition news of June 2025 includes Rhythm's national expansion, CenterPoint's grid resiliency efforts, and an exciting research discovery. Get the details on the most-read EnergyCapitalHTX stories from June 15-30 below:

1. Houston's Rhythm Energy expands nationally with clean power acquisition

PJ Popovic, founder and CEO of Houston-based Rhythm Energy, which has acquired Inspire Clean Energy. Photo courtesy of Rhythm

Houston-based Rhythm Energy Inc. has acquired Inspire Clean Energy for an undisclosed amount. The deal allows Rhythm to immediately scale outside of Texas and into the Northeast, Midwest and mid-Atlantic regions.

Inspire offers subscription-based renewable electricity plans to customers in Pennsylvania, New York, New Jersey, Massachusetts, Ohio, Delaware, Illinois, Maryland, and Washington, D.C. By combining forces, Rhythm will now be one of the largest independent green-energy retailers in the country. Continue reading.

2. CenterPoint reaches agreement on SRP to significantly reduce outages

CenterPoint says it will cut storm-related outages by 1 billion minutes with its new Systemwide Resiliency Plan. Photo via Getty Images

CenterPoint Energy has reached a settlement agreement with parties to its 2026-2028 Systemwide Resiliency Plan (SRP), which will represent the largest single grid resiliency investment in CenterPoint's history.

The plan is expected to reduce storm-related outages by 1 billion minutes for its 2.8 million customers by 2029 and build on the first two phases of the company's Greater Houston Resiliency Initiative (GHRI). This SRP is designed to further address the impacts of extreme weather threats. Continue reading.

3. Enbridge activates first solar power project in Texas

Enbridge Inc. is now generating 130 megawatts of energy from its Orange Grove solar project near Corpus Christi. Photo courtesy Enbridge

Canadian energy company Enbridge Inc., whose gas transmission and midstream operations are based in Houston, has flipped the switch on its first solar power project in Texas.

The Orange Grove project, about 45 miles west of Corpus Christi, is now generating 130 megawatts of energy that feeds into the grid operated by the Electric Reliability Council of Texas (ERCOT). Orange Grove features 300,000 solar panels installed on more than 920 acres in Jim Wells County. Construction began in 2024. Continue reading.

4. Texas drivers continue to pump the brakes on EVs, shows new report

Texas falls among the middle of the pack when it comes to EV adoption, according to a new report. Photo via Unsplash

Even though Texas is home to Tesla, a major manufacturer of electric vehicles, motorists in the Lone Star State aren’t in the fast lane when it comes to getting behind the wheel of an EV.

U.S. Department of Energy data compiled by Visual Capitalist shows Texas has 689.9 EV registrations per 100,000 people, putting it in 20th place for EV adoption among the 50 states and the District of Columbia. Continue reading.

5. Houston team’s discovery brings solid-state batteries closer to EV use

Houston researchers have uncovered why solid-state batteries break down and what could be done to slow the process. Photo via Getty Images.

A team of researchers from the University of Houston, Rice University and Brown University has uncovered new findings that could extend battery life and potentially change the electric vehicle landscape.

The team recently published its findings in the journal Nature Communications. The work deployed a powerful, high-resolution imaging technique known as operando scanning electron microscopy to better understand why solid-state batteries break down and what could be done to slow the process. Continue reading.

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