On Monday at Louisiana’s Clean Hydrogen Task Force meeting, Hyundai representatives laid out an ambitious plan to become the “catalyst for the hydrogen ecosystem” in the state. The plan centers around Hyundai’s recently announced $6 billion DRI-EAF steel mill in Ascension Parish. In order to create Louisiana as the nation’s green hydrogen leader, Hyundai laid out its vision in three stages: First, the company wants to drive demand for its green steel at the new Ascension Parish integrated mill. Second, the company aims to expand the adoption of green hydrogen from Louisiana’s other industries. And finally, expanding to a statewide hydrogen network.
While the announcement is being billed as Hyundai’s “unwavering commitment to the hydrogen economy”, there are still plenty of challenges ahead. Perhaps the most pressing issue is the proposed elimination of the Section 45V tax credit in President Trump’s “Big Beautiful Bill”. The Section 45V tax credit, included in the Inflation Reduction Act (IRA), provides federal incentives for the production of clean hydrogen. In addition to the lack of federal tax incentives, Hyundai still faces the high cost of hydrogen production. That might be harder to offset with additional funding from Louisiana’s taxpayers, who are already on the hook for $600 million for land purchases, roads, rail upgrades, and more for the new integrated mill in Ascension Parish.
Hyundai clearly sees Louisiana as critical to its U.S. business plans. According to the company, the U.S. green steel market is expected to grow at 8.5% annually through 2034. As the plant in Ascension Parish is not slated to be operational until 2029, the big question will be the availability of green hydrogen. Under the proposed plan, the plant will operate on blue hydrogen until possibly 2034 or later. But to produce green steel they need green hydrogen. How Hyundai will navigate these financial, policy, and infrastructure challenges remains to be seen. Regardless, Hyundai’s announcement about green hydrogen and green steel is definitely welcome news for steel decarbonization.
