The exponential energy opportunity: Hycamite’s role in transforming the U.S. economy

This article was previously published on LinkedIn by Carolina M. Ahlstrand

In June 2024, Matti Malkamäki and I were part of the largest Finnish delegation to visit the United States, led by H.E. Douglas Hickey, the U.S. Ambassador to Finland. During our discussions with U.S. Secretary of Commerce Gina Raimondo and our meetings with Governors Kevin Stitt of Oklahoma, Joe Lombardo of Nevada, and Jared Polis of Colorado, it became evident that the United States is a land of opportunity for energy innovation and deployment.

Since then, potential investors, partners, and customers from states such as Nevada, Oregon, Texas, North Carolina, and Colorado have visited our Customer Sample Facility in Kokkola, Finland, which is Europe’s largest methane-splitting facility. They are exploring how our technology can contribute to economic development in their states through affordable and clean energy solutions.

These meetings, along with hundreds of virtual meetings, continue to reinforce the demand in the U.S. for domestically produced low-carbon, battery-grade graphite, and clean hydrogen. Entering the U.S. market is driven by several compelling factors. The U.S offers a combination of favorable conditions, resources and initiatives that make it an attractive destination for hydrogen- and carbon-focused businesses, such as Hycamite, that benefit significantly from the following:

1. Abundant natural gas resources

The U.S. is one of the largest producers of methane in the world. Methane is an essential feedstock for hydrogen production, sourced from a diverse range of materials. These include abundant natural gas, renewable natural gas from landfills, agricultural waste, wastewater treatment, methane from coal mines and synthetic methane. Access to cost-effective, reliable and geographically distributed natural gas resources supports scalable, economically viable and environmentally friendly carbon and hydrogen production exactly where it is needed.

2. Supportive regulatory and policy environment

Federal incentives such as the Inflation Reduction Act (IRA) and Bipartisan Infrastructure Law (BIL) committed over $13 billion directly to hydrogen development, with additional strong support from states and private sector partnerships. The provision of significant tax credits makes our initial foothold selection easy:

45V Clean Hydrogen Production Tax Credit: Offers up to $3/kg for 10 years for clean hydrogen production. The final rulemaking, released on January 3, 2025, upholds the strict environmental performance criteria outlined in the proposed regulations, including the “three pillars” discussed in my colleague Fiona Mwacharo’s article. At the same time, it encourages investment in innovative hydrogen technologies. Other key highlights include the addition of renewable natural gas (RNG) and coal mine methane as feedstock and the option to lock-in the 45VH2-GREET value for the 45V time-period.

45X Advanced Manufacturing: 10% of the costs incurred by the taxpayer concerning graphite production until 2032.

48C Qualifying Advanced Energy Project Credit for investments in advanced energy projects, base credit of 6% of a taxpayer’s investment and increases to 30% if prevailing wage and apprenticeship requirements are met.

45Q Credit for Carbon Sequestration, claim per metric ton of qualified carbon captured and sequestered.

In the U.S., the criteria for clean hydrogen eligibility are different than in the EU. The EU[1] has so far defined only the technologies that can be used and the carbon footprint limits these technologies need to fulfill. This limit (3.38 kg CO₂e / kg H₂) is relatively loose, and the structure includes no mechanism to push for lower emissions in the future either. In the U.S., it is true that the lowest (well, highest) limit is less strict (4.0) than in the EU, but the USA has technology neutrality clauses and a structure to push the emissions lower. The best tax credits—up to $3 per kg of H₂—are available only for CO₂ emissions below 0.45, which is currently the strictest limit in the world. The support mechanism in the U.S. is based on tax credits to promote clean hydrogen production, with eligibility determined by the carbon intensity of the hydrogen produced. The Clean Hydrogen Production Tax Credit (Section 45V) offers a tiered incentive structure based on the lifecycle of greenhouse gas emissions associated with hydrogen production. [2]

This comparison indicates that the U.S. tax credit system is designed to incentivize a broader range of hydrogen production methods by offering varying credit amounts based on carbon intensity, whereas the EU employs a fixed threshold to define low-carbon hydrogen.

The U.S. has taken a more practical and technology-neutral approach to carbon intensity thresholds for clean hydrogen. This approach expands opportunities for various production methods compared to other regions of the world. It acknowledges the necessity for more clean energy technologies while making use of the abundant resources available. The U.S. technology-neutral approach to hydrogen production, particularly through the Clean Hydrogen Production Credit established by the Inflation Reduction Act (IRA), offers varying incentives based on the emissions rate of the hydrogen production process, without favoring any specific technology. Hydrogen from natural gas with carbon capture, electrolysis using renewable energy, and other methods can qualify if they meet the necessary emissions standards.[3]

We are confident this approach will spur more rapid development of the entire ecosystem of producers and off-takers needed to make a clean hydrogen and carbon economy viable.

3. Hydrogen hubs and infrastructure development

The U.S. Department of Energy (DOE) has provided significant funding (7 billion USD) for seven hydrogen hubs through the Bipartisan Infrastructure Law4. These hubs are designed to integrate production, storage, distribution, and end-use applications tailored to local resources (natural gas, renewables, nuclear).

Developing infrastructure, including pipelines and fueling stations, supports the growth of the hydrogen economy and the need for widely distributed hydrogen production even outside the geographies associated with the hubs.

Hycamite is actively engaging with these initiatives to maximize the opportunities to partner.

4. Strong demand from diverse sectors

The demand for clean hydrogen, low-carbon carbon, and graphite in the U.S. is rapidly increasing across various sectors, including transportation, industrial applications, and emerging fields like clean energy storage and shipping. Hydrogen plays a crucial role in the decarbonization of industries such as steel, cement, aluminum and chemical production. Additionally, green ammonia and methanol produced from hydrogen are becoming popular as bunker fuels for cargo ships. Data centers and industrial power users also drive demand for hydrogen-capable combined cycle power plants for low-carbon dispatchable power. Meanwhile, battery-grade graphite is critical for expanding gigafactories and securing a sustainable domestic supply chain for electric vehicles and energy storage.

My colleague Natascha Skog will provide a deeper dive into the different applications for clean hydrogen in her upcoming article.

5. Economic and market potential

At approximately 26% of the global GDP and 59% of the worldwide stock market value, the U.S. offers access to a vast and diverse market for clean energy products.

The hydrogen and carbon market in the U.S. is projected to grow exponentially, creating opportunities for long-term business expansion.

Significant investments are being made in U.S. battery manufacturing, with new gigafactories announced by companies like Tesla, GM, and Ford.

Compared to Europe, the U.S. has a broader and more pragmatic perspective on clean hydrogen, supporting both green and low-carbon hydrogen production, including hydrogen from natural gas with carbon capture (blue hydrogen). When leveraging Renewable Natural Gas, Hycamite can provide a carbon-negative solution to off-takers; this will hopefully be determined once the DOE releases its long-awaited updated version of the 45VH2-GREET model, which is set to take place in early 2025.

State-level incentives in states like California offer additional incentives, such as credits under the Low Carbon Fuel Standard (LCFS).

Trump’s administration energy outlook

Uncertainty is slowly ending as the agenda and administration officials and cabinet members are being nominated and selected.

January 20, often called “Day One,” sets the stage for what many call Trump 2.0. According to Hogan Lovells´s report on Election Impact and Congressional Outlook5, potential policy shifts could directly impact companies like Hycamite. While GOP members may push to repeal some IRA tax credits and subsidies related to renewable energy, electric vehicles and energy efficiency, Daniel Garcia, an attorney at Hogan Lovells US LLP, a leading international law firm in the energy sector, noted that “specific IRA provisions, such as hydrogen, biofuels, and carbon sequestration tax credits are well-positioned to survive and thrive due to strong industry backing and bipartisan support.” President-elect Trump intends to renew and broaden prior initiatives related to critical minerals essential for clean technologies and lithium-ion battery components with a particular focus on decreasing U.S. reliance on China.

The international energy market is evolving, with significant economies now balancing domestic energy supply, economic development, and environmental responsibility. The U.S. is uniquely positioned to lead the global clean energy transition, offering unparalleled resources, policy support, and market opportunities for innovative companies like Hycamite. Despite shifting political landscapes, the energy transition remains an unstoppable force, driven by the economic and environmental imperatives to decarbonize industries, secure supply chains, and foster sustainable growth.

“Hycamite’s proven technology is a great example of how innovation can drive sustainable economic development. By leveraging the U.S.’s vast natural resources and business-friendly policies, Hycamite is laying the groundwork for a cleaner, more resilient future.” Michael Walton, General Manager of Energy Transition Finance and White House Environmental Justice Advisory Council Member.

Hycamite’s proven technology, strategic partnerships, and readiness to scale position us to capitalize on the U.S.’s robust demand for clean hydrogen and low-carbon graphite. With the groundwork laid and interest from investors, offtakers, and partners stronger than ever, 2025 is the year we turn opportunity into impact, advancing a cleaner, more resilient energy future for all. Join us as we seize this once-in-a-century opportunity to reshape the global energy landscape, starting in the U.S., because the future of clean energy won’t wait, and neither should you.

Acknowledgments

I want to express my sincere gratitude to those who have contributed to this article and supported me in my work at Hycamite.

Michael Walton, General Manager for Energy Transition Finance, Environmental Justice Advisory Council Member: Thank you for your time, experience, and invaluable input, which have greatly enriched this piece.

Hogan Lovells: Your insightful reports have provided critical perspectives and depth to the content.

References:

  1. Bloomberg NEF, “Europe’s Green Hydrogen Rules Raise Costs for Industry,” Aug. 5, 2022. Accessed: Jan. 13, 2025. [Online.] https://about.bnef.com/blog/europes-green-hydrogen-rules-raise-costs-for-industry/
  2. U.S. Department of Energy, “Clean Hydrogen Production Tax Credit (45V) Resources,” Washington D.C., USA. Accessed: Jan. 13, 2025. [Online.] https://www.energy.gov/articles/clean-hydrogen-production-tax-credit-45v-resources
  3. Federal Register – Department of the Treasury Internal Revenue Service, “Section 45V Credit for Production of Clean Hydrogen; Section 48(a)(15) Election To Treat Clean Hydrogen Production Facilities as Energy Property,” Dec. 26, 2023. Accessed: Jan 14, 2025. [Online.] https://www.federalregister.gov/documents/2023/12/26/2023-28359/section-45v-credit-for-production-of-clean-hydrogen-section-48a15-election-to-treat-clean-hydrogen
  4. U.S. Department of Energy, “Biden-Harris Administration Announces $7 Billion For America’s First Clean Hydrogen Hubs, Driving Clean Manufacturing and Delivering New Economic Opportunities Nationwide,” Washington D.C., USA. Oct. 13, 2023. Accessed: Jan. 13, 2025. [Online.] https://www.energy.gov/articles/biden-harris-administration-announces-7-billion-americas-first-clean-hydrogen-hubs-driving
  5. Hogan Lovells, “Hogan Lovells 2024 Election Impact and Congressional Outlook Report,” Nov. 15, 2024. Accessed: Jan. 13, 2025. [Online.] https://www.hoganlovells.com/en/publications/hogan-lovells-2024-election-impact-and-congressional-outlook-report

Author

Picture of Carolina Ahlstrand

Carolina Ahlstrand

Business Development Director
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