Pajarito Powder board chair Tom Stephenson holds an electro-coated wafer that makes up a component of a hydrogen-powered fuel cell. Photo: J. Kyle Keener
ALBUQUERQUE, N.M. — One company in the hydrogen supply chain here shows how the Trump administration's funding pullbacks could upend the climate tech ecosystem.
Why it matters: Pajarito Powder, nestled in a small facility in the city's north end, is confident it can survive the Trump administration's cuts. But future federal policy will help determine whether its domestic market emerges.
- The company seeks to be a preeminent U.S. supplier in a supply chain now largely based in Asia and Europe. It's exactly the kind of manufacturing the IRA and infrastructure law were designed to scale up.
- "It's an industry that moved offshore many, many, many years ago, and we're one of the first to try to bring it back to the United States," said Michele Ostraat, the company's chief operations officer.
The big picture: Pajarito manufactures a fine black powder used as a catalyst in fuel cells and the electrolyzers that split water molecules into hydrogen and oxygen through a process called electrolysis.
- It grew out of technology from Los Alamos National Laboratory. The company recently got a nearly $20 million grant from the Energy Department to scale up production.
- For now, DOE is still paying invoices. But the future of the agency's hydrogen hubs and other booster programs is critical, the company's executives told Axios.
- "As those hubs get implemented, it's going to create additional demand for both the production and the consumption of hydrogen, and that means that ultimately, our customers then are going to need to have catalysts that we'll be able to source for them," said Tom Stephenson, Pajarito's board chair.
Zoom in: Pajarito produces catalysts in relatively small quantities, but that requires an immense amount of materials science and investment.
- When we visited last month, about half the facility was in flux, as new equipment was brought in as part of a bid to scale up production and meet demand from the international market.
- In one room, an emissions scrubber lay on its side, ready for installation in the expanded production facility.
Between the lines: Pajarito's primary market is in Europe and Asia right now, which could help insulate it from the GOP's proposed repeal of the 45V hydrogen tax credit.
- But the company says the Biden administration's stringent guidance for the incentive meant domestic demand for catalysts was already slowing down.
- "When the [Biden] administration dropped its bomb, it was dropped on people who were already sheltered," said CEO John Rice.
The bottom line: The Trump administration may upend the incentive-driven U.S. market for climate tech. We might see manufacturers who are already here look to markets abroad.
