Lujan Grisham calls for $20M in state funds as feds say no to hydrogen power grant.

Hydrogen power in New Mexico was dealt a likely setback as the state was denied federal funding it applied for to establish a “hub” among multiple western states.

The U.S. Department of Energy last week announced seven federally funded hydrogen hubs throughout the U.S., as part of the administration of President Joe Biden’s broader goal of diversifying American energy away from its reliance on fossil fuel.

Hydrogen is viewed by some as a cleaner, less-pollutive form of energy compared to oil and natural gas.

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It’s typically extracted from various sources and methods, usually producing only water as a byproduct when it is consumed.

The DOE reported it can be used in vehicles, homes, and several other applications.

New Mexico Gov. Michelle Lujan Grisham hoped to get in on the federal funds offered by the Biden administration, forming the Western Interstate Hydrogen Hub with Colorado, Utah and Wyoming and applying for a $1.25 billion federal grant.

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Like the federal administration, the State of New Mexico viewed this energy sources to advance its goals of reducing pollution and diversifying its economy.

A string of controversial bills backed by Lujan Grisham were introduced and defeated during the 2022 Legislative Session which would have incentivized hydrogen development across New Mexico.

The legislation, which offered a series of incentives to hydrogen power companies considering New Mexico for their operations, was opposed by oil and gas industry leaders as a bill that could restrict their operations and favor that industry over theirs.

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Environmentalists were also against the efforts, arguing hydrogen production still likely required the use of natural gas-driven energy to extract the molecule.

And despite the latest blow of not garnering federal funds for the hub proposal, Lujan Grisham said her administration still hopes to see the industry grow in New Mexico.

“While we are disappointed in the U.S. Department of Energy's decision, we are undeterred. I spoke with every project partner this morning and we agree: our bullish outlook has not changed, and we will continue to move forward,” Lujan Grisham said in a statement.

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Pedro Azaga, chief executive officer of Avangrid, a company partner in the hub said hydrogen was a viable option to aid in an energy transition for the Western U.S., where much of the country’s oil and gas is produced.

He said the project would produce “clean hydrogen” a method that uses renewable sources like wind and solar to generate the needed energy.

“Clean hydrogen will not only play an important role in the fight against climate change by reducing greenhouse gas emissions, but these projects will also create clean energy jobs and spur economic development,” Azaga said.

“New Mexicans deserve the many benefits clean hydrogen projects will bring, and the Avangrid team is dedicated to using our experience in renewables to bring them to fruition.”

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New Mexico environmental groups were unconvinced.

Camilla Feibelman said hydrogen development would bring more air pollution to the state, and government efforts to attract companies would prop up the fossil fuel industry during at time of worsening climate change she said was caused by oil and gas.

“Methane-fueled hydrogen production is a climate threat, not a solution, no matter where it is,” she said. “Methane is a greenhouse gas 80 times more powerful than carbon dioxide, and studies show that hydrogen derived from it causes more climate damage than simply burning gas at a gas plant.”

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Ennedith Lopez, with Youth United for Climate Crisis Action (YUCCA) said hydrogen technology was “unproven” in its ability to reduce greenhouse gas emissions.

“Rather than investing in unproven technology that will prolong our toxic dependence on fossil fuels, we need to be investing in community-based renewable energy solutions that build resilience and center justice and equity,” Lopez said.

On the heels of the DOE’s announcement, Lujan Grisham announced Friday the creation of the State’s Climate Investment Center, hoping to drive up projects that would reduce greenhouse gas emissions throughout New Mexico.

The center was designed to issue loans to local projects to do so, and the governor said it would bring up to $70 million in investment from state and federal sources, with the administration planning to request $20 million in “start-up” funds from the legislature in the upcoming session.

“These investments will make a difference on the ground in communities around the state,” Lujan Grisham said. “Climate action must be inclusive of all New Mexicans, and I am looking forward to seeing communities empowered through the Climate Investment Center.”

Adrian Hedden can be reached at 575-628-5516, achedden@currentargus.com or @AdrianHedden on X, formerly known as Twitter.

This article originally appeared on Carlsbad Current-Argus: Gov. Lujan Grisham 'undeterred' as feds say no to hydrogen power grant