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Green light for hydrogen investing

June 29, 2022

The movement away from fossil fuels and towards cleaner, renewable energy will transform the global economy over the next several decades. It will likely become one of the most significant investment opportunities of the next century. Forming a part of the movement is green hydrogen, a carbon-free energy carrier and a carbon-free fuel. We offer CC&L Private Capital clients the opportunity to gain exposure to this nascent sector by allocating a portion of their balanced investment portfolio to our infrastructure asset class, where appropriate.

What is green hydrogen?

Green hydrogen is created through electrolysis using only two inputs – water and renewable energy – with no emissions and oxygen as the only byproduct. It can be a substitute for carbon inputs in industrial applications, a renewable fuel source for certain modes of transport, and a medium- to long-duration electricity store to address grid intermittency as greater amounts of renewable energy replace gas, diesel and coal generation.

The Mississippi Clean Hydrogen Hub

Our infrastructure investment team is in a partnership called Hy Stor Energy that has secured the rights to a portfolio of salt domes in the US Gulf Coast called the Mississippi Clean Hydrogen Hub. The domes can store large amounts of hydrogen for long periods. The fully integrated range of projects under active development will combine solar electricity generation, green hydrogen production, large-scale salt cavern storage, electricity re-conversion, and energy transmission. The resulting renewable energy will be delivered either as green hydrogen or clean electricity to customers and can be used in various utility and industrial applications.

The Mississippi Clean Hydrogen Hub is up to ten times larger than other current US green hydrogen projects. The hub is expected to produce an estimated 110 million kilograms (kg) of green hydrogen annually and store more than 70 million kg of green hydrogen in its underground salt caverns during its first phase. While the intended end uses for the resulting energy will vary, if all of the first phase’s energy was used to power automobiles, it could fuel approximately 700,000 cars or 25,000 trucks.

Investing in infrastructure

The Hy Stor Energy partnership is noteworthy for several reasons:

  1. It is the latest in a series of strategic partnerships that we have established to provide proprietary deal flow in high-potential sectors and geographies. This partnership bolsters our existing relationships in solar energy, wind power, hydroelectricity, rail, and student transportation. We expect to continue to add to this roster of partnerships over time.

  2. It broadens and deepens our competency as investors, owners, and operators of energy transition infrastructure.

  3. The partnership provides direct exposure to the emerging green hydrogen sector.

Green hydrogen is still in its early stages as an infrastructure investment, and opportunities are difficult to access. Our investment is staged to provide downside protection while preserving significant upside potential.

If you would like to know more about green hydrogen or the infrastructure asset class, please contact a dedicated investment professional at CC&L Private Capital.

This post is for information only and is not intended as investment advice. The views expressed are those of the author at the time of publication and are subject to change at any time.

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Catherine Dorazio
Managing Director
Business Development

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