The clean hydrogen market is recalibrating. After years of planning, only 11 percent of the world’s planned production capacity for 2030 has advanced to final investment decision. In the United States, major players have pulled back from projects once seen as anchors of the emerging industry. Multi-billion-dollar projects utilizing steam methane reforming with carbon capture (SMR + CCS) in Texas (ExxonMobil), Indiana (BP), and Louisiana (Air Products), and electrolysis projects in New York and California (Air Products) are among those paused or cancelled amid regulatory shifts, economic uncertainty, and weaker-than-expected demand.
This wave of pullbacks underscores a central reality: building a brand-new commodity market rarely advances in a straight line. While turbulence is natural, the urgency of climate change leaves little margin for uncertainty. Recent U.S. efforts aimed at limiting government’s role in regulating pollution are introducing policy volatility at precisely the wrong time.
These difficulties should not be read as a failure of clean hydrogen’s utility. Rather, they offer an opportunity to address major weaknesses: high costs, lack of committed offtake, supply chain and distribution challenges, and even local opposition. This course correction creates space to examine new approaches for a market that, despite challenges, has seen committed investments grow 50 percent year-over-year since 2020.
Methane pyrolysis stands out as a compelling complement to other clean hydrogen production methods. Methane pyrolysis uses energy to split methane into hydrogen and solid carbon, avoiding direct carbon dioxide emissions. Crucially, the carbon co-products, ranging from carbon black to graphite substitutes, offer the possibility of a dual-revenue model that could reduce reliance on long-term subsidies.
