A Mid-Century Net-Zero Scenario for the State of Wyoming and its Economic Impacts
Clean hydrogen has the potential to help achieve 10% economy-wide emissions reductions by 2050 relative to 2005, promote energy security and resilience, and develop a new economy in the United States. In 2030, the hydrogen economy could create about 100,000 new jobs to build new capital projects and clean hydrogen infrastructure. The Wyoming Energy Authority recently announced the state’s energy strategy, which establishes a goal of net-zero emissions by 2050. Under all likely scenarios, achieving a mid-century net-zero target will pose challenges and create opportunities for Wyoming’s energy sector. If executed properly, the transition could favorably affect the state’s economy overall in the long term. This research program examines the economic impact of fossil energy production in Wyoming and provides various predictions for future energy mixes to achieve net-zero emissions. Preliminary work suggests that Wyoming-based hydrogen production could have significant economic benefits and job creation implications for Wyoming. This study further assesses Wyoming’s opportunities to create hydrogen-based industries, assess economic impacts, identify knowledge gaps and research needs, and create a Hydrogen Center of Excellence to accelerate commercialization and deployment. This project helped to understand Wyoming's areas of focus for research and development and identified its areas of strength and potential challenges in creating a hydrogen ecosystem. As a result of this study, we estimate that for blue hydrogen produced from coal and gas resources, the overall cost reduction will be driven mainly by the carbon-sequestration tax credit and the improvement in carbon capture. Mature technologies, like SMR and PSA, will make limited contributions. They have no or limited reductions from an additional capacity deployment in future costs. We also understand the importance of continued support from public and private sectors for Carbon Capture and Storage (CCS)-related research, development, and demonstration programs at federal and state levels. The successful and efficient production of blue hydrogen requires a unique blend of energy resources, geology, regulation, law, and infrastructure. Wyoming has the distinction of meeting all these demands. The team also estimates that the availability and command of water resources accessible for hydrogen production are crucial for developing new projects. Water treatment, use, and disposal after treatment will also make projects possible. Primarily, this is relevant for hydrogen made using renewable energy. Wyoming has one of the best wind resource capacity in the nation. Harnessing this resource is challenging due to limited transmission line availability. Hydrogen could become one of the solutions to the stranded resource problem, primarily if the water availability challenge is addressed. Using produced oil & gas water could help to solve the problem. A commonly cited barrier to the expansion of hydrogen markets is the cost associated with constructing new pipelines, which typically require large amounts of capital to develop. Wyoming already possesses much of the export infrastructure needed to connect Wyoming’s hydrogen production with major markets across the West Coast, Pacific Northwest, Midwest, and Front Range regions of the United States, where a large portion of Wyoming’s natural gas is already transported. In addition to transportation by pipeline, rail transportation of hydrogen has also proven feasible. Wyoming uses its extensive railway system to transport large amounts of coal to its export partners across the United States. By using cryogenic or compressed-gas cars, Wyoming has the potential to add hydrogen to its existing network of railroad energy exports. The same technology may also be applied to hydrogen transport via trucks traveling interstate highways. Wyoming’s workforce is ready to meet the demands of clean hydrogen development. Many of the skills and training needed for hydrogen production are the same skills already possessed by Wyoming’s oil & gas and coal workforce. Many government and industry leaders expect clean hydrogen and other low-carbon energy projects to generate significant job growth and to recruit many already-trained oil & gas and coal workers whose jobs may be displaced. As energy companies seek to penetrate the markets for Wyoming hydrogen production, there is a natural mutual benefit to Wyoming’s workers and companies seeking to launch projects with the assistance of a trained workforce. Wyoming’s university and community college system have adopted several programs to ensure that highly qualified engineers and other technically skilled employees continue to graduate with skills to support the development of hydrogen and other innovative energy projects moving forward. Throughout the project, stakeholder outreach and education took many forms, including meetings with several major companies in the industry, collaborating with local government organizations, educational organizations, and national laboratories, tribal outreach and engagement, the sponsoring of several hydrogen-focused projects in many departments throughout the University of Wyoming, and developing a collaboration with international universities. The products of these collaborations consist of working relationships with several companies in the industry, educational institutions, national labs, and local government, as well as strong connections with individuals who will play an essential role in the success of the Hydrogen Energy Research Center.