The City of Phoenix Has Joined the SHINe Regional Clean Hydrogen Hub

In 2021, Mayor Kate Gallego and the forward-thinking members of the City Council adopted the Climate Action Plan to combat climate change and improve the quality of life for its residents—to put Phoenix on the path to becoming the most sustainable desert city on the planet.  Among those efforts have been initiatives to plant trees in underserved communities, install 73 miles of cool pavement in residential neighborhoods, accelerate water conservation and zero-waste programs, build a healthy food network, expand clean transportation, and support the transition to a clean energy economy.

An important next step in working toward a carbon-neutral and cleaner sustainable future was the Mayor and Council’s unanimous decision on November 2, 2022, to join the newly formed Southwest Clean Hydrogen Innovation Network (SHINe.)

SHINe has recently submitted a concept paper to the Department of Energy as a first step to applying for federal support from the Infrastructure Investment and Jobs Act for a Regional Clean Hydrogen Hub.

What is SHINe?

It is a consortium group with academic, industrial, and local government stakeholders from Arizona, the Navajo Nation, and Nevada who are banding together to apply for a billion-dollar stream of funding from the Department of Energy, through the Bipartisan Infrastructure Law, to create a regional clean hydrogen hub that will complement and augment other sustainable energy initiatives like solar and wind.

Among the Arizona stakeholders partnering in this project are:

• APS
• SRP
• Southwest Gas.
• Tucson Electric Power
• Arizona State University.
• Northern Arizona University
• The University of Arizona.
• The City of Phoenix.
• Navajo Nation
• Phoenix Hydrogen.
• Nikola Corporation

At the November 2, 2022, City Council meeting approving the decision, Phoenix Mayor Gallego commented:

“Hydrogen will be important to all our decarbonization efforts including transitioning heavy-duty vehicles from fossil fuels…We want to diversify our decarbonization resources so that we are not overly dependent on any one solution. We’ve learned that we can be more resilient and adapt to multiple challenges when we have multiple tools. Our region is well poised to be leaders. We have a strong culture of innovation and we’re well equipped to be on the leading edge of hydrogen technology development in partnership with our utilities, universities, and business partners…We are already developing hydrogen products. We have an incredible opportunity to drive sustainability and create good-paying jobs for our residents…This will position us well for the future.”

Arizona State University’s Dr. Ellen Stechel, the Executive Director of The Center for an Arizona Carbon-Neutral Economy @ ASU (AzCaNE), and Mark Hartman, the Chief Sustainability Officer for the City of Phoenix, graciously took the time to respond to questions about SHINe and its benefits to the Southwest region, and its residents.

Dr. Stechel’s responses will be followed by Mr. Hartman’s.

Dr. Stechel

• Please describe ASU and the other university’s role in spearheading the Hydrogen Consortium Project. What is your role in this project?

“Let me preface this first and say that we hope to facilitate the establishment of a robust clean hydrogen ecosystem, a clean hydrogen alliance, and a clean hydrogen industry. I prefer to always keep the word clean in front of hydrogen because there is an existing hydrogen industry, but there’s not an established clean hydrogen industry yet in the U.S. But one is emerging and that is what we need to nurture.”

“What is it going to take to create a clean hydrogen ecosystem, especially in states like Arizona, that do not even have the makings of any hydrogen industry is really an unprecedented level of collaboration to scale in a short amount of time. It will entail a rapid scale-up of an industry that doesn’t yet exist. Collectively, we will be trying to get to a considerable scale in roughly a decade’s time. The tailwinds behind the industry, which is amazing, come from the Infrastructure Investment and Jobs Act and the Inflation Reduction Act.”

“But to do it as fast as we need to and the way we want to, that’s where universities, like ASU, come in because we are in a great position to use what I call convening power. Our capacity to facilitate bringing people together, people who have a diverse set of perspectives because everybody looks at this from so many different lenses and differing viewpoints and differing opinions. I think we’ve been successful at keeping conversations constructive for everyone despite many differing perspectives, but ultimately, we have to do our best to make the right things happen.”

“It is an industry that is going to make it happen not universities, not ASU alone. The role of the university and the role of AzCaNE is to bring people together and to bring them together in a way that has enough coherence that something real, something good, something impactful happens. We facilitate, we catalyze, we educate, we do outreach, we can organize important and sometimes difficult conversations and prepare white papers or fact sheets, and ultimately, we can and will do a lot of workforce development, which is going to be so important for the industry, for people, for communities. So, there are a lot of roles for the universities.”

“The hard work is what industry has to do, but left to their own devices, they might more likely compete than collaborate or share knowledge, at least initially. What I like to think we’ve been able to elicit amongst the ecosystem is co-opetition, a word coined two decades ago in recognition that to achieve growth in an industry, it is advantageous to cooperate and compete at the same time.  A lot of other, even more, mature industries do work in this co-opetition model. They cooperate a lot in industry alliances on common interests that wouldn’t provide a competitive advantage. What’s interesting to me about clean hydrogen ecosystems and SHINe is that there are natural allies because clean hydrogen has a very wide value chain, producers and consumers with storage and infrastructure linking them thus making for natural allies but at the same time, there are fierce competitors within the value chain. Nonetheless, they all have to somehow work together to build this industry and accelerate the momentum. Again, this is a place where universities, where ASU and others can facilitate.”

“As to my role, I have the honor and the privilege to serve as the founding Executive Director of the Center for an Arizona Carbon-Neutral Economy. The center’s origin, something I am proud of, stems from the utilities asking ASU to form a dedicated center because they are committed to deep decarbonization but also recognize the challenges and the pressures to implement, before knowing the right things to do that will guarantee reliability, affordability, and resilience for the electric grid and gas distribution. There will be benefits of clean hydrogen to the utilities, but producing that hydrogen adds challenges. So, the utilities have a critical role to play, they will become consumers, but they also have a large stake in enabling production and a stake in storage and infrastructure. They came to ASU partially because we can be an honest broker, trusted, and for the knowledge development and dissemination role. The utilities are genuinely committed to deep decarbonization and doing so for the benefit of their customers. We all want to get to carbon neutral. But no one really knows how to get there, especially while being resource-conscious and wanting to ensure reliability, resilience, and affordability. While the fossil fuel industry is an extractive industry that everyone wants to move away from, much of what the nation and the world are planning to do instead could shift from one extractive industry to another. And if not done mindfully could trade one problem for another. So, to accommodate the expected growth from extensive electrification and renewables penetration, we do know clean hydrogen will have an important role to play, but we do not know exactly how large or all that it is going to take while trying to not continue to make the mistakes of the past. So, they asked us to form this center because pooling resources, sharing knowledge from a lot of perspectives, and learning together is the best way to get to good solutions to implementable solutions—solutions that won’t become tomorrow’s problems. After deciding to form the center, we asked the two other state universities to join us, so the founding entities are the four utilities, APS, SRP, TEP, and SWG, and the three public universities, ASU, NAU, and UA. My initial role was to get the approvals to establish the center with myself as the director and my continuing role is to lead the effort in terms of growing the network and working together toward a common goal, a carbon-neutral thriving Arizona and desert southwest economy by 2050.”

• Please advise how the utility company’s sustainability interests and local governments that have signed up, fit into the organizational structure of this Clean Hydrogen Consortium.

“They are very important stakeholders in the consortium. Not the only stakeholders, as I can’t think of anyone or any sector that is not a stakeholder in this initiative. Some may have more of a stake than others, but pretty much everyone is a stakeholder, meaning what they do will have an impact on others and/or what others do will have an impact on them. The utilities are a big stakeholder because building this industry in Arizona is going to have a lot of implications for the electric grid. It certainly can help ensure reliability and resiliency but its production can also cause resiliency and reliability challenges. A lot of this clean hydrogen is going to be made using electricity from renewable resources, given the abundant sunlight in Arizona. But the sun only shines part of the day. And clean hydrogen producers for economic reasons will want to produce for as many hours of the year as possible, independent of day or night, sunny or cloudy, summer or winter. So, the electric utilities have a very big stake in how to provide electricity when the sun is not shining and do so sustainability—but not increasing cost to their other customers. The gas distribution utility has a stake in potentially blending some of that hydrogen into their pipeline distribution system at least during a transition period.”

“If we really want to get to a carbon neutral economy, we can do a lot of that with electrification, renewables, solar and wind, and batteries. That is going to take us a long way to the goal. But that approach is not going to take us one hundred percent of the way because it is going to be exceedingly difficult, expensive, or resource intensive to electrify everything from solar, wind, and batteries. Examples include heavy-duty trucking, aviation, mining vehicles, you name it, buses, fire trucks, and maritime. Maritime might not seem relevant to Arizona as a use case, but it is because Arizona can export our sun for that use case, for example to the ports in southern California. A lot of things are still going to need something other than straight electrons if we are going to get to a sustainable economy and sustainable energy system. Clean hydrogen definitely has a role to play, not as a silver bullet, but as a key role when there are no better solutions.”

“Local governments are going to have decisions to make. They have to do a lot of learning to make the right decisions to get to full carbon-neutral operations. We’re talking with some of the local governments about the bus fleets, about the garbage trucks, about the fire trucks, about airports. Also, local governments have a role to play in establishing best practices, policies, and incentives so the right things can happen and the wrong things do not happen. Cities and local governments are some of the stakeholders and some are signing up to be part of AzCaNE and part of SHINe because they have problems to solve and they have solutions to offer and they want to learn from each other and avoid reinventing wheels or duplicating efforts.”

Do you see hydrogen as one way in addition to solar and wind to get to carbon neutral where it is an all-the-above approach?

“Yes, kind of an all the above, but the one difference is hydrogen is an energy carrier, not an energy source. So, solar and wind, without a doubt, that’s where the renewable resources are, but if you make electrons and do your energy services with those electrons directly or use some of those electrons or the sun directly and you make clean hydrogen then you have an intermediary – the hydrogen – to then perform energy services or in some cases as a feedstock to make another product. We need both. We also need storage mechanisms. So, batteries, rightfully so, everybody is excited about—especially lithium-ion batteries—but ideally, you want batteries to be used only for a few hours of the day when the sun is not shining or when the wind is not blowing, and it is a peak demand time. But, right now, batteries are not economical for much more than four hours per day, at least not in the foreseeable future. So, we need something else. Clean hydrogen is one of those something else. There are still other pieces of the pie—other energy storage technologies that should also be part of the solution—like storing heat, like pumped hydro where available, like compressed air, like gravity-driven concrete blocks. Just to plant a seed, something maybe we should be thinking about is, if we mine lithium in Arizona and use clean hydrogen in those mining operations and also establish recycling operations, then we could have a much more nuanced conversation about batteries.”

• Have short- and long-term goals for the consortium been formulated? If so, please describe what they are.

“Yes and no given the scope of the effort to establish SHINe and produce a compelling proposal to the DOE that is our short-term goal. It is already a very large effort for a very new center. So, all our energies and the initial focus are on creating the regional clean hydrogen hub, creating SHINe, and bringing federal dollars to Arizona, Nevada, and the Navajo Nation and using those federal dollars to accelerate the scale-up of the industry and drive down the cost of producing, storing, distributing, and using clean hydrogen where better solutions are not available. But I should mention that the center is not just about clean hydrogen. It’s about getting to a carbon-neutral economy for Arizona and the region by 2050 and doing so in a manner that benefits everyone—people, planet, and prosperity—and importantly do not leave anybody behind and equally importantly giving a voice and a seat at the table for all stakeholders. So that’s the broader vision for the center”

“When the Infrastructure Investment and Jobs Act was signed into law last November, a little over a year ago, that presented a huge opportunity for everyone who could or wanted to participate in or benefit from the economic opportunity that accompanies bringing new projects, quality jobs, new industry to Arizona and the region. So, we essentially placed all of our attention on that short-term goal of establishing a regional clean hydrogen ecosystem, building the foundations for a vibrant industry benefiting all Arizonans  and the southwest region—not just a few—and creating the foundations for the SHINe proposal.”

“We think a regional clean hydrogen hub is not only good for Arizona, Nevada, and the region and for the Navajo Nation, who are official members of the Center and SHINe, but it is also good for the United States given the strategic location, given the resources that exist here, especially the solar resource and the largest nuclear plant in the country but also large copper and lithium deposits and large mining operations, given the freight traffic that travels the interstates, which cross through the region, given the companies that are choosing to relocate or expand their operations in this region, given they want clean energy, given that this all brings good quality jobs, and so on and so on. ”

• Is there anything not covered in the first three questions that you would like the readers to know about the Hydrogen Consortium Project?

“Some of the things that occurred to us besides the obvious abundance of sunlight is that we are situated in a very strategic location because, prior to the Infrastructure Investment and Jobs Act and the Inflation Reduction Act, clean hydrogen has been developing for a long time in other locations in the world. A lot of nations have strategic hydrogen plans and hydrogen roadmaps for clean hydrogen, but the US as a nation is less so, with the exception of our neighboring state to the west, California. But California is not going to be able to produce, for all kinds of reasons, enough clean hydrogen to serve their demand, but they are heavily incentivizing that demand. Arizona and Nevada can produce a great deal more clean hydrogen than they are going to need for their own demand, which starts in heavy-duty trucking. We note that Nikola Corporation, located here in Arizona, is at ground zero for heavy-duty trucking. Demand also starts with other heavy-duty mobility like Phoenix is doing and like what Nevada is doing in South Las Vegas. So being able to produce clean hydrogen very close to California and to serve that demand places us in a strategic location.

We have major freight corridors highways and rail that go right through the state like the I-10 and I-40. So much of the energy that’s not easily electrified goes to moving that freight. We move lots of goods around the country and a lot of them come through on I-10 and I-40 on their way, either east or west or in both directions. So, our region is very strategic to the mobility transition. We also have a major international airport (Sky Harbor), also strategically located in Phoenix and on the West Coast. We have something else in Arizona and Nevada and that’s mines which are so important to the clean energy transition and some critically important materials such as copper and lithium and quartz. Arizona supplies most of the copper in the United States. Arizona has not yet mined very much lithium, but Arizona and Nevada do have lithium deposits, that have emerged as a very important element. From a security and sustainability perspective, we really should not want to find ourselves with geopolitical issues regarding where are we sourcing the clean energy supply chain. We should prefer doing that in our backyard here in Arizona and Nevada. Also, manufacturing is growing very fast in these two states. Manufacturing and new companies (or old companies moving here) want clean energy 24/7, and clean hydrogen is able to supply that energy. All of these, I see as some of the key reasons why this clean hydrogen consortium project is so important to the nation and so important to the region, and a huge economic opportunity—an opportunity to do things differently in terms of energy justice and benefiting everyone who might otherwise be adversely impacted by the clean energy transition—those who have traditionally been exploited or left behind. Another reason why pulling it all together as a consortium, an ecosystem, a network, whichever you prefer to call it, is we can ensure that everyone benefits, people, the planet, and profits such that no one is left behind or left out of the conversation. That’s a strong commitment we have in the center.”

“Finally, one of the very important goals and plans for SHINe and regional clean hydrogen hubs is the community benefits plan, which includes a diversity, equity, inclusion, and access plan, it includes community engagement early and frequently – that seat and voice at the table. It includes a justice 40 plan to ensure that 40 percent of the benefits from federal dollars flow to underserved or disadvantaged communities including those who will be adversely affected by the closure of coal plants and including native American tribes. The community benefits plan also includes an extensive workforce development plan. All of these activities that form the community benefits plan will be further developed with a lot of voices between now and the full proposal and will continue to develop and evolve as we do more learning on how best to provide value and benefits.”

 Mr. Hartman

• Please tell the reader the benefits of creating the Hydrogen Consortium.

“The hydrogen consortium was launched in response to the federal government announcing over seven billion in funding for regional hydrogen hubs.  The extent to which we can bring together various partners and resources will help with the attractiveness of our proposal.  And this particular consortium, which includes our utilities, cities, academia, and many hydrogen/private industries in Arizona and Nevada, as well as transit departments in Arizona and Nevada, means that we can develop solutions at the scale necessary for transformative change.

• Please explain to the reader how hydrogen can be safely harnessed to create clean energy. As a follow-up, please explain how this consortium complements other clean energy sustainability initials like solar and electric vehicles.

“Hydrogen is a naturally occurring and readily available molecule, however, it requires energy to extract and separate it prior to its use.  Clean hydrogen, often referred to as green hydrogen, means it’s produced using clean or renewable sources. And the process is extremely efficient. Two gallons of water can produce almost two pounds of hydrogen via electrolysis, which translates to a range of over 50 miles in a light-duty electric vehicle.  We can use clean hydrogen for electricity generation or operating equipment with no tailpipe emissions and no negative CO2 emissions. In a fuel cell, hydrogen and oxygen are mixed to produce electricity and the one by-product is the water that was used to create the hydrogen in the first place.

How does this complement the city’s other initiatives in electric vehicles and also solar?

 “We see the transition to electric vehicles as a solution to pollution.  However, in the case of heavy-duty equipment, it may take some time to develop batteries capable of handling heavier loads over longer distances. The hydrogen engine and fuel cells are a great near-term solution for these types of vehicles. It also complements our other efforts as they relate to solar—as green hydrogen and solar are both important parts of the green economy.

Hydrogen is obviously flammable and everyone remembers the history of the Hindenburg. Can you address how safe hydrogen is?

“The Hindenburg, launched in 1937, was a very unique circumstance in the early days of hydrogen-based transportation when a huge volume of hydrogen in a balloon-like structure reacted to static electricity in the air.  It is very different in a vehicle with a small hydrogen tank—similar to a gasoline tank—that converts hydrogen to electricity through a fuel cell without the use of combustion. Hydrogen is also about 57 times lighter than gasoline vapor and 14 times lighter than air. This means that if it is released in an open environment, it will typically rise and disperse rapidly. This is a safety advantage in an outside environment.  Hydrogen engines are also tested nationally, and would be required to meet national safety standards similar to other engine types.”

• What is the timetable for applying for support from the Department of Energy, receiving approval, and commencing work?

“We submitted the concept proposal on November 4^th and we expect to hear back in January.  If it is accepted, they’ll give us a due date for writing a full, more robust, proposal. Probably a dozen consortiums from around the US have applied to the Department of Energy who will be selecting the most viable concepts and asking for detailed proposals.  If selected we’ll submit a full proposal probably by mid-next year (June 2023) after which DOE will select the winning proposals and award funding.

However, it will take a number of years to fully build out all aspects of the hub, so, I see that funding coming in over a five-year period.”

If the proposal does not gain approval from a Department of Energy, is Phoenix willing to go on its own on a smaller scale?

“We will be using hydrogen in our buses and many of the members in the consortium are current hydrogen producers and suppliers. But I think the goal of the hydrogen hub is to transition to a greener and more economic source of hydrogen. So, it’ll certainly help in producing lower-cost transportation solutions. But regardless, hydrogen is in the future of transportation in the US and so this will just be an accelerator to do it in the greenest and most economic way.”

• Is there anything not covered in the first three questions that you would like the readers to know about the Hydrogen Consortium and your proposal?

“I think it will be exciting to see this hub developed here in the southwest along with probably eight other hubs that are going to be around the US. If we are awarded this funding, it’ll help accelerate and transform the whole transportation sector to low carbon. I would call this a home run from Phoenix’s point of view.  It would be transformative, considering our air quality.   Light-duty electric vehicles combined with heavy-duty hydrogen vehicles would remove a lot of the transportation emissions—including emissions from trucks coming from California and going across, over to Florida, along the I-10, and from trucks traveling up through Nevada.  This hub could provide clean hydrogen refueling for not just Arizona and Nevada but the whole transportation network.”