April 3, 2024
By Mark Rigby
On October 13, 2023, the Biden Administration announced an ambitious set of grants to advance the administration’s goal to promote the development and deployment of renewable hydrogen. Today most hydrogen is produced from fossil fuels, principally natural gas, which results in significant CO2 emissions. Renewable hydrogen is produced with much lower carbon intensity processes. Funding for the program is included in the Bipartisan Infrastructure Law and is being administered by the Department of Energy’s (DOE) Office of Clean Energy Demonstrations (OCED). Seven regional clean hydrogen hubs were selected for awards ranging from $750 million to $1.2 billion per award. The hubs are composed of multiple organizations interested in developing a renewable hydrogen market. For example, the California-based hub, the Alliance for Renewable Clean Hydrogen Energy Systems (ARCHES), reports greater than 450 founding members on its web site including industry, labor, government and California community organizations.
Stillwater is following DOE’s Hydrogen Hub program. Opinions vary on the potential impact of renewable, also called clean, hydrogen in transforming the energy industry from some who are strongly skeptical to those who believe renewable hydrogen will profoundly affect the energy landscape. Given the divergence in views and the scale of the DOE’s program, Stillwater plans to periodically interview program participants and DOE representatives to report on the program’s progress. To kick off this series, we spoke with Mote’s CEO, Dr. Joshuah Stolaroff. Mote is a climate technology startup focused on converting waste wood into renewable hydrogen with project sites in the state’s Central Valley. Mote is a member of the ARCHES hub. The interview was conducted on March 15th via video conference.
Joshuah Stolaroff
Josh co-founded Mote three years ago after spending eleven years with Lawrence Livermore National Laboratory where he led the Lab’s carbon capture program. After spending twenty years working in the sector, he concluded that sufficient incentives were in place and markets existed to support a viable commercial venture focused on the production of hydrogen by biomass gasification with carbon capture and storage. Based on his work at Livermore, this represented an opportunity to create a whole new category of climate mitigation. Josh believed that the opportunity represented the most compelling set of technologies he had studied. Mote’s approach was also appealing because its technologies were individually proven, although not demonstrated in the combination envisioned by Mote. The company is also developing a suite of new technologies for improving its processes.
Mote’s ARCHES Project
Mote’s first project, located in Kern County, has been included in the ARCHES DOE grant. The project’s scope encompasses sourcing biomass (primarily agricultural waste wood); designing, constructing, owning and operating a gasification plant; capturing and sequestering the produced CO2; and selling the produced hydrogen for primarily transportation purposes. Mote has identified a partner to transport and sequester the CO2 following its liquification.
The opportunity to join ARCHES occurred at an advantageous time during Mote’s development of both project sites. ARCHES ran a competitive process for the DOE grant funds. Mote submitted applications on behalf of both projects, and its Kern County site was subsequently selected for a “substantial” amount of funding from ARCHES. The ARCHES hub is being led by a public-private partnership that is currently negotiating a cooperative agreement with the DOE which will finalize the award with an expectation of completion this summer. ARCHES will subsequently execute similar arrangements with its members that have been awarded grants.
While the grant award and administrative processes are complex and time consuming, Mote believes its participation in the hub will be valuable beyond the funding, given the hub’s mission of advancing the hydrogen economy. Many hub members joined to become part of the mission without an expectation of receiving grant funding. Josh also cited the state’s commitment to streamline state permitting processes for hub members as a key reason to join the hub.
Project Status and Timeline
Mote’s Kern County project is prepared to start front end engineering design, having completed pre feed studies and site selection. Partners for the hydrogen offtake, CO2 storage and major vendors have also been identified. Discussions on CEQA (California environmental permitting) have been initiated. Josh reports that the Kern County Planning Commission has been very supportive and considers Mote as a key tenant in its planned carbon management business park which will consolidate CO2 storage, power supply and related activities under a master permitting plan. Mote is targeting construction to start in 2025 with commercial operations commencing in late 2027 or early 2028. Josh also reports that the community has been supportive given the expected job creation (especially the opportunity to redeploy oil and gas workers) and the project’s air quality benefits compared with other biomass disposal methods (such as field burning and combustion in power plants). Mote’s plant has minimal air emissions, although an air permit is required. The project also plans to use hydrogen-fueled trucks to transport its wood feedstock and produced hydrogen rather than diesel-powered trucks, typical in today’s fleets which are a significant contributor to pollution in the Central Valley region. The Mote facility will not require municipal or fresh water for operation. Each Mote facility is expected to produce sixty tons of low carbon intensity hydrogen per day.
Project Funding
In addition to the DOE grant, project viability is dependent on the federal 45V (hydrogen) tax credit and California’s low carbon fuel standard (LCFS) programs. Both programs have recently issued proposed guidance (IRS) or modifications (CARB) for their programs which have generated strong feedback from interested parties. Stillwater asked about Mote’s views on the proposed guidance/regulation revisions. Mote supports the proposed 45V rules and believes the guidance is reasonable and within the spirit of the legislation. Mote’s gasification approach is not as sensitive to the IRS guidance for using renewable power compared with electrolyzer-produced hydrogen, a process that other renewable hydrogen developers are utilizing. Mote’s process uses about twenty-five percent of the power required to produce electrolyzer hydrogen, including the significant power requirements to liquify the CO2 produced from the process. As for the proposed LCFS revisions, Josh wishes CARB would get on with the process of finalizing the rules and thinks the revisions makes sense.
Broadening Beyond California
When asked whether the Mote process could be economic outside California, Josh responded that either additional enhancements to the federal program such as the ability to “stack” 45V (hydrogen) and 45Q (carbon sequestration) credits or a higher value 45Q credit like the direct air capture credit value would be necessary. Alternatively, the adoption by more states of programs similar to California’s LCFS program could make expansion beyond California feasible for hydrogen suppliers. The key to being competitive with electrolyzer hydrogen is being compensated for carbon removal.
Lessons Learned
When asked what has surprised him the most since joining Mote, Josh responded that he initially believed that the party that completes a project first would be advantaged, but his opinion has evolved to believing that all market participants benefit from a completed project. Josh added that he didn’t appreciate how hard it is to get any project over the finish line. Commenting on what has been the most rewarding, he cited how many people share a common vision for biomass carbon removal at scale among the government, university and industry communities. Josh expressed his belief that carbon removal remains essential to our shared fate, and that it would be hard to do it alone as a small company. He specifically cited CalFire, the California Department of Conservation, the U.S. Forest Service, the National Laboratories, Mote’s university and corporate partners and the DOE as having been especially supportive.
This is just the beginning…
Stillwater expects to conduct additional discussions with other DOE hub participants and the DOE staff responsible for administering the program. As of the publication date, DOE’s OCED staff have not been responsive to interview requests.
Want to learn more about Mote? Visit Mote’s website ( www.motehydrogen.com ) or contact Josh at [email protected].
