The Hydrogen Podcast

The Truth Behind Hydrogen’s Big Promise – What Went Wrong and What Comes Next

Paul Rodden Season 2025 Episode 422

In this episode of The Hydrogen Podcast, we unpack the Forbes article “What Happened to the Hydrogen Economy?” by Robert Rapier and break down the five reasons hydrogen hasn’t revolutionized the energy sector—yet.

From the broken promises of Bush-era policy to the economics of modern hydrogen production, we explore what went wrong, and more importantly, what’s next.

We spotlight low-cost, low-carbon intensity (CI) hydrogen production methods—steam methane reforming (SMR) with carbon capture, natural hydrogen, and methane pyrolysis—that could finally build a demand-driven U.S. hydrogen economy.

We also reveal why the repeal of the Section 45V tax credit might actually push the industry forward and how the Midwest could emerge as the next hydrogen hub by powering ammonia production with natural hydrogen at $0.50–$1/kg.

📊 All data sourced from the U.S. DOE, IEA, and BloombergNEF.

🎧 Listen now to learn:

  • The 5 biggest roadblocks hydrogen still faces
  • How H.R.1 shifts U.S. hydrogen strategy
  • What production methods can scale economically
  • Why the Corn Belt may become a clean energy giant

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Today, I’m unpacking the Forbes article "What Happened To The Hydrogen Economy?" by Robert Rapier, published May 22, 2025. For the first half, I’ll dissect Rapier’s take on why hydrogen hasn’t yet revolutionized our energy system, as envisioned by President George W. Bush in 2003. Then, I’ll pivot to the road ahead, focusing on low-cost, low carbon intensity (CI) hydrogen production methods—steam methane reforming with carbon capture and sequestration, natural hydrogen, and methane pyrolysis—as the economic foundation for a thriving hydrogen economy. I’ll spotlight how natural hydrogen could transform ammonia production in the Midwest, turning the Corn Belt into a clean energy powerhouse. All cost estimates per kilogram of hydrogen are sourced from the U.S. Department of Energy (DOE), International Energy Agency (IEA), and BloombergNEF reports, as referenced in Rapier’s article and aligned with industry standards. All of this on todays hydrogen podcast.

Let’s start with Rapier’s article, which takes a hard look at the unfulfilled promise of Bush’s 2003 State of the Union address, where he launched a $1.2 billion initiative to develop hydrogen-powered vehicles, dreaming of a future where “the first car driven by a child born today could be powered by hydrogen and pollution-free.” That child is now 22, and, as Rapier wryly notes, their driveway is more likely to hold a Tesla than a Toyota Mirai. Why has the hydrogen economy stalled? Rapier lays out five key barriers, and they’re a sobering lesson in economics and technology. First, hydrogen’s low volumetric energy density requires compression to 350–700 bar or liquefaction at -253°C, driving up transport and storage costs. According to DOE and BloombergNEF data, these costs add $0.50–$1 per kilogram, compared to $0.10–$0.20 for gasoline, making hydrogen logistics a pricey puzzle. Second, the U.S. has fewer than 60 public hydrogen refueling stations, mostly in California, each costing $2–$3 million to build, versus over 100,000 EV charging stations. This infrastructure gap creates a classic chicken-and-egg problem: no stations, no adoption; no adoption, no stations. Third, 95% of global hydrogen comes from SMR using hydrocarbons, costing $1–$2 per kilogram but emitting 10–12 kg CO2 per kilogram, per IEA estimates, undermining its clean credentials. Hydrogen produced via electrolysis with renewable energy, while low-CI, costs $4–$6 per kilogram, per DOE and BloombergNEF, two to three times more than SMR. Fourth, fuel cell electric vehicles (FCEVs) like the Mirai, with a 312-mile range, cost $50,000–$70,000, and hydrogen fuel at $16–$20 per kilogram makes them costlier per mile than EVs or gasoline cars. Finally, EVs have outpaced FCEVs, with 5 million plug-in vehicles globally by 2018 versus 7,500 FCEVs by 2019, thanks to cheaper batteries and widespread charging.

Rapier argues that economics is the crux: hydrogen’s high production and infrastructure costs make it uncompetitive for consumer transport. He estimates a nationwide network of 10,000 refueling stations would cost $20–$30 billion, far beyond Bush’s $1.2 billion plan. Safety concerns, like 2019 hydrogen station explosions in California and Norway, also spooked investors, though modern Kevlar-lined tanks reduce risks. Rapier pivots to hydrogen’s strength in industrial applications—ammonia, refining, and steel—consuming 70 million tons annually worldwide, where stable demand sidesteps transport’s infrastructure woes. He’s cautiously hopeful, suggesting technological breakthroughs, regulatory clarity, and targeted applications could revive hydrogen, though not as the universal fix Bush envisioned. The “One Big, Beautiful Bill Act” (H.R.1), passed by the House on May 22, 2025, reinforces this economic focus by repealing the Section 45V Clean Hydrogen Production Tax Credit, which offered up to $3 per kilogram for low-CI hydrogen. While the Fuel Cell and Hydrogen Energy Association warns of delays to $50 billion in projects, like Air Products’ $4.5 billion Louisiana facility, I see H.R.1 as a nudge toward cost-effective methods. The bill retains the Section 45Q credit, providing $85 per ton of CO2 captured, and restricts foreign entity credits, prioritizing SMR with CCS, natural hydrogen, and methane pyrolysis at $1–$2 per kilogram, per DOE and IEA data, to build demand and infrastructure, like the 1,000 refueling stations needed by 2030, costing $2–$3 billion.

Now, let’s chart the hydrogen economy’s future, where economics must drive the bus. To advance, we need low-cost, low-CI production methods to create a demand-driven market, and that means leaning into SMR with CCS, natural hydrogen, and methane pyrolysis, all delivering hydrogen at $1–$2 per kilogram, as per DOE, IEA, and BloombergNEF estimates. SMR with CCS is the backbone, capturing 90–95% of emissions and leveraging the U.S.’s 2.6 million miles of pipelines and hydrocarbon expertise. The 45Q credit, offering $0.50–$1 per kilogram, makes it viable for industrial applications like ammonia, which uses 10 million tons of hydrogen annually in the U.S. CF Industries’ Donaldsonville CCS project, capturing 2 million tons of CO2 yearly, earns $100–$150 million annually, showing the model’s strength. Scaling CCS to store 50 million tons of CO2 by 2030 requires $5–$10 billion in pipelines, but projects like the Heartland Greenway, costing $1–$2 billion, prove it’s doable. Technical challenges include leak-proof CO2 transport, with pipelines at $50–$100 million per 100 miles, but advances in corrosion-resistant materials are closing the gap.

Natural hydrogen, extracted from geological deposits, is a wild card at $0.50–$1 per kilogram, per DOE estimates. Koloma’s pilots in the Midwest and Gulf Coast could yield 1–5 million tons annually by 2030, with drilling costs of $10–$50 million per site offset by near-zero CI. The process, akin to natural gas extraction, faces hurdles in reservoir mapping, requiring $1–$5 million in seismic and geochemical tools per site, but leverages existing drilling tech. Methane pyrolysis, splitting methane into hydrogen and solid carbon at $1–$2 per kilogram, per BloombergNEF, avoids CO2 emissions. Monolith Materials’ Nebraska facility sells carbon for $500–$1,000 per ton, boosting economics. It uses plasma or thermal reactors, with 20–30 kWh per kilogram, but scaling energy-efficient systems remains a challenge, though plasma tech could cut costs by 10–20%.

A prime opportunity is using natural hydrogen for ammonia production in the Midwest, turning Iowa, Nebraska, and Illinois into clean energy hubs. Ammonia, vital for fertilizers, demands 1–2 million tons of hydrogen annually in the region. Natural hydrogen at $0.50–$1 per kilogram, versus $1.50–$2 for SMR, could slash costs by 20–30%, saving farmers $100–$200 million yearly and cutting emissions by 5–10 million tons of CO2, per IEA projections. Koloma’s projects, tapping deposits formed via serpentinization, require $5–$10 million in exploration but could supply 500,000 tons of hydrogen by 2030, supporting 25% of Midwest ammonia, creating 1,000–2,000 jobs, and driving $1 billion in economic activity. The 45Q credit supports hybrid models, combining natural hydrogen with CCS for other applications, ensuring low CI. This aligns with Rapier’s call for targeted industrial applications, avoiding transport’s infrastructure bottlenecks.

Electrolysis, at $4–$6 per kilogram per DOE and BloombergNEF, needs time to reach $2–$3 by 2030 through R&D into catalysts (replacing platinum) and solid oxide electrolysis (SOE), using waste heat to hit 40 kWh per kilogram. H.R.1’s foreign entity restrictions may raise electrolyzer costs by 10–20%, but they spur domestic manufacturing, with Nel Hydrogen’s plants creating 500–1,000 jobs each. The Senate, with a 53-47 Republican majority, could raise 45Q to $100 per ton, boosting SMR-CCS. Public-private partnerships, like California’s ARCHES hub, could fund $10–$15 billion in infrastructure, supporting FCEVs for heavy transport. By 2030, SMR with CCS, natural hydrogen, and methane pyrolysis could supply 60–70% of U.S. hydrogen demand (20 million tons annually), with electrolysis scaling to 5–7% of energy demand by 2050 as renewables drop to $20–$30 per megawatt-hour. The Midwest’s ammonia pivot could decarbonize 10–15 million tons of CO2, driving $5 billion in growth. Rapier’s right—hydrogen’s no silver bullet, but with economics leading, it’s a powerhouse waiting to shine.


Alright, that’s it for me, everyone.  If you have a second, I would really appreciate it if you could leave a good review on whatever platform you listen to. Apple podcasts, Spotify, Google, YouTube, etc. That would be a tremendous help to the show. And as always if you ever have any feedback, you are welcome to email me directly at info@thehydrogepodcast.com. So until next time, keep your eyes up and honor one another.