getty
Industries like steel, cement, chemicals and aluminum account for around one-quarter of the nation’s greenhouse gas emissions. To help clean them up, the Biden Administration announced it would spend $6 billion on new technologies that could drastically cut these industrial emissions. The funding, from the Department of Energy, will go to 33 projects in 20 states.
These projects run the gamut. Steel manufacturer Cleveland-Cliffs will get up to $500 million to replace a large coal-consuming blast furnace in Middletown, Ohio, with a hydrogen-ready direct reduced iron plant and two electric melting furnaces. Aluminum producer Constellium
Researchers have been working for years on innovative ways to cut emissions from these core industries. But many of the efforts are at relatively early stages, and it’s been tough to scale them up quickly because of the cost. In announcing the funding at Cleveland Cliffs’ Middletown plant, Energy Secretary Jennifer Granholm said that the initiative—the largest single decarbonization investment in U.S. history—would leverage a total of $20 billion, including the companies’ own investments, and slash carbon dioxide emissions by 14 million metric tons a year.
The Big Read
The Metals Company
This Deep-Sea Mining Company Will Sweep The Ocean Floor For Battery Materials—If It Doesn’t Go Broke First
Gerard Barron, CEO of The Metals Company, sports a shaggy mop of hair, a rakish beard and a leather bomber jacket with a palm-sized, poly-metallic nodule in its pocket. Aside from setting off metal detectors, the nodule is a good conversation starter, since it was recovered from the Pacific Ocean seafloor, two miles down, where it formed over millions of years by precipitating atoms of metals out of the seawater. It contains nickel, manganese, cobalt and copper — all vital to the manufacture of batteries like those that power electric vehicles. Moreover, he says, there are billions of these metal-rich nodules, worth trillions of dollars, just sitting on the bottom of the ocean waiting to be picked up. “We need much more metal as we move to lower-carbon energy, and this is how we can get those metals with the lightest impact,” says the 57-year-old Barron.
But funds to carry out his plans are getting tight. TMC went public on Nasdaq, via a SPAC in 2021, raising $570 million at a $2.9 billion valuation with the goal of commercially harvesting seabed rocks. Today the company still has no revenues, while shares have fallen 80%. Last quarter TMC was down to its last $25 million. Last week, the company announced its full-year 2023 results — which amounted to a total cash burn of $60 million against $20 million raised, and just $7 million left in the bank.
Hot Topic
Xinhua News Agency via Getty Images
Eric Guter, vice president of Air Products, on the outlook for clean hydrogen
Many companies and the Energy Department have multibillion-dollar plans to cut industrial greenhouse gasses and create carbon-free fuel with clean hydrogen. But energy giants including ExxonMobil
We see markets developing all around the world. Europe has a very strong pull for green hydrogen. In the U.S., we have states that are leading the way on climate. You and I happen to live in [California] with the most aggressive climate policy in terms of decarbonizing various sectors of the economy and about 16 other states are following their lead. Other states will follow, one way or another. Take transportation as an example. Transportation doesn't stay within state borders, especially when we're talking about long-haul trucking. There'll be infrastructure that gets built out beyond these states that are leading the way on climate.
We see Japan and Korea creating their own policies. Markets are shaping up all around the world. We have to decide: are we going to be a leader, as a country, on climate or not? We certainly see a robust market for the projects that we're delivering on. It's too bad that others aren't seeing that but I think they look at it through a different lens.
The proposed clean hydrogen production tax credit of up to $3 per kilogram is getting pushback because only companies that make it from water and new renewable power sources — not existing installations — can get the maximum benefit.
U.S. power demands are only increasing. If we're going to grow energy demand by producing electrolytic hydrogen we have to add new clean power resources to support that. Otherwise, we're going to exacerbate the emissions problem on the backs of taxpayers. That will destroy a long-term, viable clean hydrogen market. That's one of the things we're very concerned about. Folks on the other side of this debate talk about starting with a weaker standard. Well, how do you ever go from that weak standard to a higher standard? There's no plan to do that.
Where will clean hydrogen be used in the next few years?
Hydrogen fills in the sectors where we cannot electrify. Most prominently, that's heavy industry and heavy-duty transportation. Today we use a lot of hydrogen primarily in refining and agriculture. Those are sectors that are mainly amenable to clean hydrogen production. We just have to get the right rule sets in place that encourage these sectors to convert rapidly. In transportation, California has very aggressive policies to decarbonize. It represents about 50% of California's emissions. And there other heavy industries like steel, cement and glassmaking.
The energy transition is going to be bumpy to start. But once we get going — and we've already taken the first few steps and that's been accelerated by the federal government — it's going to become clearer and clearer that there are markets for this. There is a path to decarbonization. I think that's going to help consolidate the industry once we get clarity on the rules.
What Else We’re Reading
EPA's new rules to clean up heavy trucking met with support and criticism
New York approves congestion pricing to curb automotive gridlock and pollution
Japan’s biggest utility partners with ExxonMobil on low-carbon ammonia, hydrogen
Hydropower generation in the Western U.S. dropped to a 22-year low in 2023
Beavers can help stop wildfires. And more places in California are embracing them
Electricity is a bull market for the first time in a decade
Swedish startup Renewcell promised to help fashion go green. Brands didn’t want to pay for it.
China’s battery giant says geopolitical tensions won’t derail its U.S. expansion
More From Forbes
