Can Small Hydrogen Hubs Power a Big U.S. Energy Change?

Sumitomo and Independence Hydrogen bet on small local networks to cut costs and emissions while facing regulatory hurdles

7 Oct 2025

Sumitomo Corporation of Americas and Independence Hydrogen have formed a partnership to develop a network of modular hydrogen systems across the United States, signaling a shift from large-scale production plants toward smaller, localized energy infrastructure.

Announced in July 2025, the collaboration aims to accelerate clean fuel adoption by deploying compact generators, known as DeHy units, that can produce hydrogen close to industrial users. The systems are designed to lower logistics costs and reduce transport-related emissions by serving factories, transport hubs and distribution centres within regional clusters.

Initial projects will focus on Houston, Chicago and Newark, with the companies targeting more than 25 installations nationwide by 2027. Progress will depend on securing permits and financing, both of which remain significant hurdles for hydrogen infrastructure.

Hydrogen is widely viewed as critical to achieving net-zero targets, yet the sector has struggled to scale due to high capital costs and regulatory delays. Industry analysts said the distributed model could complement federally supported hydrogen hubs, some of which have faced lengthy approval processes. They likened the approach to rooftop solar’s role in decentralizing electricity generation.

For Sumitomo, the partnership expands its hydrogen portfolio and strengthens its position in North America. Independence Hydrogen gains access to global capital and supply-chain expertise, allowing faster deployment of its modular systems.

Both companies cautioned that the initiative remains exposed to market and policy risks, noting that construction schedules could shift as permitting and safety rules evolve.

If realised, the plan could establish a flexible network of regional hydrogen supply points, supporting industries in their transition to lower-carbon energy while easing dependence on centralized production facilities.