ESG, Much? Mississippi Takes Green Hydrogen To The Next Level

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The Energy Department launched an $8 billion hydrogen program last year, and state officials around the nation are scrambling to get a slice of the pie. In some cases they are even putting partisan politics aside. The latest example is the deep red state of Mississippi, where the firm Hy Stor Energy is working on a plan to transform the Magnolia State into a green hydrogen powerhouse.

Mississippi Steel Maker To Lead Decarbonization March

Mississippi is among two dozen or so states in which Republican governors, legislators, treasurers, and attorneys general have been railing against ESG (environmental, social governance) corporate risk management principles. As for why, that’s not a mystery. In the context of climate change, one key way to manage risk is to decarbonize. Fossil energy stakeholders and their allies in public office have been pushing back, by trying to steer investor dollars away from renewable energy ventures.

The anti-ESG sentiment run deep in Mississippi, at least on the surface. “Among those critical of ESG are Governor Tate Reeves, State Treasurer David McRae, both U.S. Senators Roger Wicker and Cindy Hyde-Smith, and the three GOP Congressmen,” the Tate Record reported on March 21. Nevertheless, one hand doesn’t seem to know what the other is doing.

Last November, for example, Governor Reeves proudly announced that Indiana-based Steel Dynamics is pumping $2.5 billion into an expansion of its existing campus in Mississippi, under the largest economic development deal in the state’s history. Steel Dynamics happens to be a founding member of the Global Steel Climate Council, which has proposed a new standard for greenhouse gas transparency in the steel industry.

“This new standard will accelerate the actual reduction of greenhouse gas emissions and provide key decisionmakers with transparent and consistent data to make informed decisions,” explained said Mark D. Millett, the company’s Chairman and CEO in a press release in April.

Steel Decarbonization Movement Rolls Into Mississippi

Steel Dynamics is beginning to walk the decarbonization walk. Among its recent moves is a new biocarbon venture to reduce greenhouse gas emissions related to electric arc furnaces, which will be part of the newly expanded campus.

Steel makers are also eyeballing green hydrogen as a pathway to steel decarbonization, meaning hydrogen produced from water or other renewable resources instead of natural gas and other fossil resources. That’s where Hy Stor Energy comes in.

Hy Stor first proposed a green hydrogen hub for Mississippi back in 2021. Under the name Mississippi Clean Hydrogen Hub (MCHH), the project leverages Hy Stor’s underground salt formations for storing hydrogen gas in bulk, produced only from renewable resources. Hydrogen functions as an energy carrier, so the bulk storage angle would effectively provide steel makers and other industrial users with reliable, 24/7 access to renewable energy.

Despite all anti-ESG posturing, Governor Reeves enthusiastically endorsed the project in a hearty letter of support addressed to US Energy Secretary Jennifer Granholm in October of 2021. He cited the state’s abundant supply of sunlight and water, a reference to electrolysis systems powered by renewable energy to push hydrogen gas from water.

“I proudly support Hy Stor Energy’s project,” he concluded.

A Green Hydrogen Hub For Mississippi, And Beyond

That 2021 letter seems to be the extent of Reeves’s publicly stated support for the Hy Stor proposal, but other officials have been more forthcoming. Last summer, Hy Stor launched a partnership with the Hancock County Port and Harbor Commission to provide green hydrogen to Stennis International Airport and the Port Bienville Industrial Park, which houses SABIC Innovative Plastics, DAK Americas, SNF Polychemie, Calgon Carbon, and Jindal Tubular USA, among other potential industrial-scale green hydrogen users.

“Hydrogen is emerging as a way to cut carbon emissions in energy-intensive sectors like manufacturing and transportation,” noted the Commission’s CEO, Bill Cotter, referring to the aim of growing the maritime, rail and aerospace sectors in Mississippi.

Hy Stor’s Richton salt dome in Perry County will kick off the action, and that’s just for starters. Hy Stor envisions a network of pipelines connecting additional salt domes in Mississippi and Louisiana.

ESG Or Not, Green Hydrogen Is Here To Stay

Last week, Hy Stor cemented its proposal with a formal application for up to $1 billion in funding for MCHH, through the Energy Department’s Clean Hydrogen Hub program.

“The MCHH’s geological endowment and critical access to the heartland of the U.S. via major logistics and shipping corridors make it a vital hydrogen storage and transmission location,” Hy Stor emphasized in a press release announcing the application, adding that the company is already engaging with industrial, logistics, and community partners in states throughout the Southeast and Gulf of Mexico.

Hy Stor also noted that MCHH has already received considerable private sector funding and is on track to break ground soon, possibly later this year. “Development of the MCHH will put the entire state of Mississippi at the forefront of efforts to strengthen regional energy resilience, establish partnerships to prioritize education, and pursue equitable distribution of energy investments,” the company enthused.

“The MCHH will supply zero-carbon hydrogen in large quantities around the clock, enabling energy-intensive industries, including steel, chemicals and agri-nutrients, to decarbonize their operations rapidly and lead the way toward a low-carbon future,” Hy Stor emphasized.

“MCHH will enable the transition of existing manufacturing and transportation systems to lower-carbon sources of energy, and will attract new, low-emission industrial manufacturing capacity to Mississippi,” the company added for good measure.

More Renewable Energy For Mississippi

As a ripple effect, MCHH could help provide Mississippi’s renewable energy industries with a much-needed shot of adrenaline. The state has been drifting around in the wind and solar power doldrums in terms of installed capacity, but activity is finally beginning to pick up.

Earlier this year, the energy company Entergy hit the start button on a new 100-megawatt solar array, the biggest utility-owned array in the state so far. The new facility kicks off Entergy’s five-year, 1,000-megawatt solar power plan. The Solar Energy Industries Association estimates that the state will add a total of 2,494 megawatts of solar power over the next five years, bumping it up to a respectable #18 in the trade group’s state-by-state solar ranking.

If Hy Stor is planning to bring wind energy into the electrolysis mix, that prospect has improved as well. The company AES is planning a 200-megawatt wind farm in Tunica County, which will be the first utility-scale wind farm in the state.

Who’s Afraid Of The ESG?

The anti-ESG movement shows no signs of slowing down, despite the obvious contradiction involved in attracting investor dollars on the one hand, while bad-mouthing investor ESG strategies on the other.

In Mississippi, for example, Hy Stor’s financial partner is the firm Connor, Clark & Lund Infrastructure, which puts ESG front and center in its business model. “We believe that a rigorous and continuous review of Environmental, Social and Governance (“ESG”) factors is fundamental to a well-managed infrastructure portfolio and we consider ESG in our analysis of each investment,” CCL states.

“ESG considerations are deeply integrated throughout our investment process from initial assessment through decision making and during ongoing ownership,” they add.

Interesting! Hy Stor and CCL seem to have the environmental leg of ESG well in hand, but the social part of the equation could be a sticky wicket in terms of attracting and retaining top talent. Republican office holders in Mississippi continue to push the state into the bottom of the reproductive and human rights barrel, making the state an unsafe place for women, girls and transgender persons.

No more Trainwreck Twitter. Find me on Spoutible: @TinaMCasey or LinkedIn @TinaMCasey or Mastodon @Casey or Post: @tinamcasey

Image (screenshot): Green hydrogen courtesy of Hy Stor.

 


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