Blue hydrogen has emerged in recent months as the dominant investment choice in the US when it comes to hydrogen. Major energy players are prioritising carbon capture-backed hydrogen over its greener cousin. Despite long-term hopes for green hydrogen, 90% of the country’s clean hydrogen projects are now blue, driven by regulatory realities and market constraints, as well as the fossil-first policy of the Trump administration.
It is a trend that is explored more fully in the latest gasworld Global magazine, which is out now.
By the end of 2025, analysts expect at least three major US blue hydrogen projects to reach final investment decisions FIDs, cementing the country’s role as a global leader in blue. ExxonMobil, Air Products, and Linde are spearheading investments, banking on carbon capture and storage to align hydrogen production with emissions targets. ExxonMobil’s Baytown facility in Texas could become the world’s largest blue hydrogen plant, producing one billion cubic feet per day and capturing 10 million tonnes of CO₂ annually. Meanwhile, Air Products is investing $4.5bn in a Louisiana plant expected to capture and store 95% of its CO₂.
Yet blue hydrogen remains a disputed gas molecule. Critics still argue it could lock in fossil fuel dependence, with concerns over methane leakage and the reliability of carbon capture and storage as a strategy. A 2021 Cornell-Stanford study suggests blue hydrogen could even be worse for the climate than burning natural gas.
With US federal support for blue hydrogen expected to continue to grow, while incentives for green hydrogen still face uncertainty. Chris Jackson, CEO of UK green hydrogen company Protium, made the point in an interview with gasworld that blue hydrogen is only viable if subsidies remain stable.
“If you’re making a bet on blue hydrogen, you’re making a bet that subsidies and carbon pricing won’t change. But if they do, these projects could become stranded assets,” Jackson said.
While the US looks set to continue backing blue hydrogen, the European Commission is tightening emissions rules, making its future in Europe more uncertain. For now, however, blue hydrogen is winning the investment race.
Read more: In focus… blue hydrogen
