Vinson & Elkins’ multidisciplinary team of lawyers has been advising clients on transactions involving the production and marketing of hydrogen for many years, including in the refining, petrochemicals, and mobility sectors. As a result, our lawyers have extensive knowledge on how hydrogen is produced, used, stored, transported, marketed and sold. V&E also has significant experience advising on hydrogen development related matters such as carbon capture, utilization and storage operations. Many of the legal issues involved in the emerging hydrogen industry reflect those encountered in the wider energy sector, from increasing M&A activity, to project development matters and the potential for future project financing as hydrogen becomes more established. As market leaders in the energy industry across the world, these are areas where V&E has comprehensive and wide-ranging existing experience ready to leverage.
Hydrogen, as a versatile energy carrier and chemical feedstock, offers advantages that unite all of our nation’s energy resources – renewables, nuclear and fossil fuels – and enables innovations in energy production and end uses that can help decarbonize three of the most energy intensive sectors of our economy: transportation, electricity generation and manufacturing. Companies are beginning to make serious headway in growing a “hydrogen economy”, establishing hydrogen as an exciting and viable component of the future energy mix.
Hydrogen’s potential contribution to carbon neutrality is reliant on how it is produced. Used as a key industrial gas in the refining and chemical sectors, including ammonia production, most hydrogen today, commonly referred to as “gray” hydrogen, is produced from fossil fuels through coal gasification or steam methane reformation processes, which emit CO2 into the atmosphere.
Driven by an expansion of the range of applications for hydrogen in the energy sector (including power generation, heating, transport, energy storage and the decarbonization of industrial sectors such as steelmaking and iron smelting), the current wave of interest in the hydrogen industry is focused on “blue” and “green” hydrogen production. “Blue” hydrogen is produced in a similar manner to gray hydrogen, but carbon-capture technologies are incorporated in the process to prevent CO2 from being released. The cleanest variety, known as “green” hydrogen, is produced through the electrolysis of water powered by renewable energy sources, resulting in zero-carbon emissions and a clean and sustainable fuel source.
As hydrogen develops as a cleaner fuel and energy source, Vinson & Elkins continues to assist clients in delivering on the evolving energy mix. Our lawyers advise on a full range of hydrogen related matters, including:
- Full suite of project development matters
- Project and other financing structures
- Carbon Capture, Utilization and Storage (CCUS) infrastructure supporting large-scale hydrogen production
- Investments in hydrogen companies and related joint ventures
- Mergers and acquisitions
- Regulatory advice and counseling
- Technology licensing
- Environmental permits, wildlife impact, and land use advice
- Purchase and sale of environmental attributes, including renewable energy credits
- Complex litigation
- International alternative dispute resolution
- Environmental, social and governance (ESG) advice and counseling
- Representing issuers and underwriters in a variety of capital-raising transactions, including IPOs and combinations with SPACs