Duke Energy forms coalition with Dominion Energy, Southern Co., others to

seek federal Southeast Hydrogen Hub funding


Charlotte Business Journal • 11-01-22 • By John Downey
Duke Energy Corp. and four other major Southeast power companies have joined a coalition with leadership from Ohio-based Battelle to pursue federal financial support for a six-state Southeast Hydrogen Hub.

On Sept. 22, the U.S. Department of Energy opened applications for $7 billion worth of federal funding to develop six to 10 regional hydrogen hubs in the United States. The money will be invested in developing a web of “green hydrogen” production sites that will use zero-carbon electricity resources to manufacture hydrogen as well as “blue hydrogen” produced from gas-fired electricity with carbon capture and storage.

Duke (NYSE:DUK) has joined Dominion Energy Inc. (NYSE:D), The Southern Co. (NYSE:SO), Louisville Gas & Electric Company and Kentucky Utilities Company — subsidiaries of Pennsylvania-based PPL Corp. (NYSE:PPL) and the Tennessee Valley Authority (NYSE:TVC) in the coalition. The coalition expects to attract a growing list of hydrogen users from major industries in Alabama, Georgia, Kentucky, North Carolina, South Carolina and Tennessee.

Swati Daji, Duke’s head of enterprise strategy and planning, says the federal funding opportunity “is vital to our industry-leading clean energy transformation.”

“A Southeast hydrogen hub will provide economic and workforce-development benefits that will extend well beyond the timeline for these projects,” she says. “We are pleased to have Battelle’s leadership and experience on our side as we work together with the coalition to make this hub a reality.”

The money comes from $8 billion set aside for hydrogen development in the $65 billion bipartisan infrastructure bill passed in November 2021 complemented by incentives in the Inflation Reduction Act passed this summer.

Matt Vaughn, president of Battelle’s Applied Science and Technology group, called the coalition a team with “a lot of strong players.”

“We think Battelle’s expertise and long history of operating large complex programs for the Department of Energy and other federal agencies can help uniquely position this team for success to address the critical issue of creating a clean energy future,” he says of the not-for-profit organization’s role in the coalition.

Carolinas sites near Duke Energy nuclear plants for carbon-free electricity
Initial information gathered by the coalition identifies 22 sites that include existing and proposed hydrogen production facilities as well as pending applications for possible sites in the six states.

Two are in North Carolina, near Charlotte and Wilmington, and two in South Carolina in the Upstate and near Charleston. The North Carolina locations would have access to carbon-free electricity from Duke’s McGuire and Catawba Nuclear stations near Charlotte and the Brunswick Nuclear Station on the coast. The Upstate location would have access to carbon-free power from the Oconee Nuclear Station and the Bad Creek and Jocassee pumped-hydro stations.

DOE’s hydrogen hub program calls for the development of six to 10 hubs funded through the infrastructure law. Concept papers are due Nov. 7, and DOE said full applications are due April 7, 2023.

Regional groups will have to demonstrate the capacity for production, processing, delivery, storage and end-use of clean hydrogen. DOE intends locate hubs in different regions and leverage energy resources abundant to that region. It will give priority to hubs most likely to create opportunities for skilled training and long-term employment large numbers of residents in their region.

Battelle says DOE plans to spend $6 billion to $7 billion in this first round hub development, depending on how many are funded. The remaining $1 billion to $2 billion will be made a part of later hub development rounds.