II 

117TH CONGRESS 

1ST SESSION S. 3118 

To require the Secretary of Energy to establish a hydrogen infrastructure 

finance and innovation pilot program, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

OCTOBER 28, 2021 

Mr. CORNYN (for himself, Mr. COONS, Mr. CASSIDY, Mrs. CAPITO, Mr. HEINRICH, and Mr. LUJA ́N) introduced the following bill; which was read twice 

and referred to the Committee on Energy and Natural Resources 

A BILL 

To require the Secretary of Energy to establish a hydrogen 

infrastructure finance and innovation pilot program, and 

for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Hydrogen Infrastruc5 ture Finance and Innovation Act’’. 

6 SEC. 2. STUDY. 

7 Not later than 1 year after the date of enactment 

8 of this Act, the Secretary of Energy, in coordination with 

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1 cy, the Council on Environmental Quality, the Adminis2 trator of the Energy Information Administration, and the 

3 heads of other relevant Federal agencies, shall conduct a 

4 study subject to notice and public comment— 

5 (1) to fully assess and report the potential lay6 out of pipeline corridors that are robust against a 

7 range of projected hydrogen demand futures; 

8 (2) to synthesize the results from research, de9 velopment, and demonstration projects on materials 

10 and metallurgy for transporting and storing hydro11 gen and hydrogen-rich fuels; 

12 (3) to determine outstanding questions with re13 gard to research, development, and demonstration of 

14 infrastructure for transporting and storing hydrogen 

15 and hydrogen-rich fuels; 

16 (4) to investigate the behavior and environ17 mental impact of hydrogen leakage in pipelines and 

18 from geologic storage sites and nongeologic storage 

19 equipment; 

20 (5) to determine best practices for the construc21 tion and maintenance of hydrogen pipelines; 

22 (6) to determine the percentage at which hydro23 gen must be blended into the natural gas network to 

24 substantially reduce carbon intensity; and 


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1 (7) to establish a framework for the measure2 ment, reporting, and management of hydrogen leaks. 

3 SEC. 3. SUPPORTING HYDROGEN INFRASTRUCTURE AND 

4 REGIONAL DEVELOPMENT OF HYDROGEN. 

5 (a) DEFINITIONS.—In this section: 

6 (1) BOARD-REGULATED RATES.—The term 

7 ‘‘Board-regulated rates’’ means rates regulated by 

8 the Surface Transportation Board. 

9 (2) COMMISSION-REGULATED RATES.—The 

10 term ‘‘Commission-regulated rates’’ means rates reg11 ulated by the Federal Energy Regulatory Commis12 sion. 

13 (3) COMMON CARRIER.—The term ‘‘common 

14 carrier’’ means a transportation infrastructure oper15 ator or owner that— 

16 (A) publishes a publicly available tariff 

17 containing the just and reasonable rates, terms, 

18 and conditions of nondiscriminatory service; 

19 and 

20 (B) holds itself out to provide transpor21 tation services to the public for a fee. 

22 (4) ELIGIBLE ACTIVITY.—The term ‘‘eligible 

23 activity’’ means an activity described in subsection 

24 (g)(2) relating to, or carried out in connection with, 

25 an eligible project. 


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1 (5) ELIGIBLE ENTITY.—The term ‘‘eligible enti2 ty’’ means a corporation, partnership, joint venture, 

3 trust, non-Federal governmental entity, agency, or 

4 instrumentality, or other entity. 

5 (6) ELIGIBLE PROJECT.— 

6 (A) IN GENERAL.—Subject to subpara7 graph (B), the term ‘‘eligible project’’ means an 

8 infrastructure project for hydrogen transpor9 tation, storage, or delivery, including pipeline, 

10 shipping, rail, refueling, or other infrastructure, 

11 or associated equipment, as the Secretary deter12 mines to be appropriate. 

13 (B) INCLUSION OF PIPELINE PROJECTS.— 

14 The term ‘‘eligible project’’ includes a pipeline 

15 project only if the project is for— 

16 (i) the construction of 1 or more new 

17 pipelines that are capable of handling pure 

18 hydrogen; or 

19 (ii) the retrofitting of 1 or more exist20 ing natural gas pipelines— 

21 (I) to transport a blend of hydro22 gen and natural gas; and 

23 (II) in a manner that will signifi24 cantly increase the capacity of the 


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1 pipelines to transport hydrogen, as de2 termined by the Secretary. 

3 (7) ELIGIBLE PROJECT COST.— 

4 (A) IN GENERAL.—The term ‘‘eligible 

5 project costs’’ means— 

6 (i) the costs of carrying out an eligible 

7 activity; and 

8 (ii) any costs described in subpara9 graph (B) relating to, or incurred in con10 nection with, an eligible project. 

11 (B) COSTS DESCRIBED.—The costs re12 ferred to in subparagraph (A)(ii) are— 

13 (i) the costs of capitalized interest 

14 necessary to meet market requirements, 

15 the costs of reasonably required reserve 

16 funds, capital issuance expenses, and any 

17 other carrying costs during construction of 

18 the applicable infrastructure; and 

19 (ii) transaction costs associated with 

20 financing an eligible project, including the 

21 cost of legal counsel and technical consult22 ants. 

23 (8) HIFIA PILOT PROGRAM.—The term 

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1 structure finance and innovation pilot program es2 tablished under subsection (b)(1). 

3 (9) LETTER OF INTEREST.—The term ‘‘letter 

4 of interest’’ means a letter submitted by a potential 

5 applicant prior to an application for a grant or a 

6 loan under the HIFIA pilot program that— 

7 (A) is in a format prescribed by the Sec8 retary on the website of the HIFIA pilot pro9 gram; 

10 (B) describes the project and the location, 

11 purpose, and cost of the project; 

12 (C) outlines the proposed financial plan, 

13 including— 

14 (i) the requested grant or loan assist15 ance; and 

16 (ii) the proposed obligor, if applicable; 

17 (D) provides a status of environmental re18 view; and 

19 (E) provides information regarding satis20 faction of other eligibility requirements of the 

21 HIFIA pilot program. 

22 (10) LOW-INCOME OR DISADVANTAGED COMMU23 NITY.—The term ‘‘low-income or disadvantaged 

24 community’’ means a community (including a city, a 

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1 visible segment of a larger municipality) with an an2 nual median household income that is less than 100 

3 percent of the statewide annual median household 

4 income for the State in which the community is lo5 cated, according to the most recent decennial census. 

6 (11) OBLIGOR.—The term ‘‘obligor’’ means an 

7 eligible entity that is liable for payment of the prin8 cipal of, or interest on, a loan under the HIFIA pilot 

9 program. 

10 (12) SECRETARY.—The term ‘‘Secretary’’ 

11 means the Secretary of Energy. 

12 (b) ESTABLISHMENT.— 

13 (1) IN GENERAL.—Not later than 1 year after 

14 the date of enactment of this Act, the Secretary, in 

15 consultation with the Federal Energy Regulatory 

16 Commission, the Surface Transportation Board, and 

17 the Administrator of the Pipeline and Hazardous 

18 Materials Safety Administration, shall establish a 

19 hydrogen infrastructure finance and innovation pilot 

20 program under which the Secretary shall provide— 

21 (A) financial assistance to eligible entities 

22 for eligible projects through— 

23 (i) grants; or 

24 (ii) long-term, low-cost supplemental 

25 loans; and 


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1 (B) technical assistance in accordance with 

2 subsection (l). 

3 (2) COORDINATION WITH HYDROGEN HUBS.— 

4 To ensure that the HIFIA pilot program is compat5 ible with and complementary to any hydrogen hubs 

6 developed under any other law, the Secretary, to the 

7 maximum extent practicable, shall coordinate the es8 tablishment of the HIFIA pilot program with— 

9 (A) the establishment of any program to 

10 support the development of hydrogen hubs that 

11 is required to be established under any other 

12 law; and 

13 (B) the development of those hubs. 

14 (c) ELIGIBILITY.— 

15 (1) IN GENERAL.—The Secretary may provide 

16 financial assistance for an eligible project under the 

17 HIFIA pilot program if— 

18 (A) the eligible entity proposing to carry 

19 out the project submits a letter of interest prior 

20 to submission of an application under para21 graph (2) with respect to the project; and 

22 (B) the eligible entity and the eligible 

23 project meet all applicable requirements of this 

24 section. 

25 (2) APPLICATIONS.— 


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1 (A) IN GENERAL.—To be eligible for a 

2 grant or a loan under the HIFIA pilot pro3 gram, an eligible entity shall submit to the Sec4 retary an application at such time, in such 

5 manner, and containing such information as the 

6 Secretary determines to be appropriate. 

7 (B) ELECTION.— 

8 (i) IN GENERAL.—An eligible entity 

9 may elect to apply for a grant, a loan, or 

10 both under the HIFIA pilot program. 

11 (ii) DECISION.—The Secretary shall 

12 have discretion to award any mix of grants 

13 and loans under the HIFIA pilot program 

14 as the Secretary determines to be appro15 priate, including with respect to each eligi16 ble entity that applies for both a grant and 

17 a loan. 

18 (C) APPLICATION PROCESSING PROCE19 DURES.— 

20 (i) NOTICE OF COMPLETE APPLICA21 TION.—Not later than 30 days after the 

22 date of receipt of an application under this 

23 paragraph, the Secretary shall provide to 

24 the applicant a written notice describing 

25 whether— 


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1 (I) the application is complete; or 

2 (II) additional information or 

3 materials are needed to complete the 

4 application. 

5 (ii) APPROVAL OR DENIAL OF APPLI6 CATION.—Not later than 90 days after the 

7 date of issuance of a written notice under 

8 clause (i), the Secretary shall provide to 

9 the applicant a written notice informing 

10 the applicant whether the Secretary has 

11 approved or disapproved the application. 

12 (d) PRIORITY.—In selecting eligible projects to re13 ceive a grant or a loan under the HIFIA pilot program, 

14 the Secretary shall give priority to eligible projects that— 

15 (1) will provide greater net impact in avoiding 

16 or reducing emissions of greenhouse gases; and 

17 (2) are sited in a manner that minimizes envi18 ronmental disturbance and other siting concerns, in19 cluding by being sited within, or adjacent to, existing 

20 pipeline or other linear infrastructure corridors. 

21 (e) CONSIDERATIONS.—In selecting eligible projects 

22 to receive a grant or a loan under the HIFIA pilot pro23 gram, the Secretary, to the maximum extent practicable, 

24 shall select projects— 


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1 (1) that are large-capacity, common carrier in2 frastructure; 

3 (2) that enable geographical diversity in associ4 ated projects and supply chains to produce, use, or 

5 store hydrogen, with the goal of enabling projects in 

6 all major regions of the United States with current 

7 hydrogen demand and potential future hydrogen de8 mand; 

9 (3) that will generate the greatest benefit to 

10 low-income or disadvantaged communities; and 

11 (4) that will— 

12 (A) maximize creation or retention of jobs 

13 in the United States; and 

14 (B) provide the highest job quality. 

15 (f) LOANS.— 

16 (1) IN GENERAL.—In carrying out the HIFIA 

17 pilot program, the Secretary shall make loans to eli18 gible entities, the proceeds of which shall be used to 

19 finance eligible projects. 

20 (2) INTEREST RATE.—The interest rate of a 

21 loan under the HIFIA pilot program shall be not 

22 less than the interest rate on United States Treas23 ury securities of a similar maturity to the maturity 

24 of the loan on the date of closing on the loan. 


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1 (3) MATURITY DATE.—The final maturity date 

2 of a loan provided under the HIFIA pilot program 

3 shall be the date that is 30 years after the date of 

4 substantial completion of the applicable eligible 

5 project. 

6 (4) REPAYMENT.— 

7 (A) IN GENERAL.—The Secretary shall es8 tablish a repayment schedule for each loan pro9 vided under the HIFIA pilot program. 

10 (B) COMMENCEMENT.—Repayment of a 

11 loan provided under the HIFIA pilot program 

12 shall commence on the date of substantial com13 pletion of the applicable eligible project for 

14 which the loan was provided. 

15 (C) DEFERRAL OF REPAYMENT.—If, at 

16 any time during the 5-year period beginning on 

17 the date of substantial completion of an eligible 

18 project, the project is unable to generate suffi19 cient revenues in excess of reasonable and nec20 essary operating expenses to pay the scheduled 

21 loan repayments of principal and interest on the 

22 loan, the Secretary may allow the borrower to 

23 defer repayment of the loan until the end of 

24 that 5-year period. 

25 (5) REQUIREMENTS.— 


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1 (A) CREDITWORTHINESS.— 

2 (i) IN GENERAL.—Each obligor with 

3 respect to a loan provided for an eligible 

4 project under the HIFIA pilot program 

5 shall be creditworthy, such that there ex6 ists a reasonable prospect of repayment of 

7 the principal and interest on the loan, as 

8 determined by the Secretary under clause 

9 (ii). 

10 (ii) REASONABLE PROSPECT OF RE11 PAYMENT.—The Secretary shall base a de12 termination of whether there is a reason13 able prospect of repayment under clause (i) 

14 on a comprehensive evaluation of whether 

15 the obligor has a reasonable prospect of re16 paying the loan for the eligible project, in17 cluding evaluation of— 

18 (I) the forecast of noncontractual 

19 cash flows supported by market pro20 jections from reputable sources, as de21 termined by the Secretary, and cash 

22 sweeps or other structural enhance23 ments; 

24 (II) the strength of the contrac25 tual terms of an eligible project (if 


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1 available for the applicable market 

2 segment); 

3 (III) the projected financial 

4 strength of the obligor— 

5 (aa) at the time of loan 

6 close; and 

7 (bb) throughout the loan 

8 term, including after the project 

9 is completed; 

10 (IV) the financial strength of the 

11 investors and strategic partners of the 

12 obligor, if applicable; and 

13 (V) other financial metrics and 

14 analyses that are relied on by the pri15 vate lending community and nation16 ally recognized credit rating agencies, 

17 as determined to be appropriate by 

18 the Secretary. 

19 (B) DEDICATED SOURCE OF REVENUE.— 

20 An eligible project for which a loan is provided 

21 under the HIFIA pilot program shall have a 

22 dedicated source of revenue separate from any 

23 financial assistance received under the HIFIA 

24 pilot program. 

25 (g) USE OF FINANCIAL ASSISTANCE.— 


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1 (1) IN GENERAL.—A grant or loan provided 

2 under the HIFIA pilot program may be used for any 

3 eligible project costs. 

4 (2) ELIGIBLE ACTIVITIES.—A grant or loan 

5 provided under the HIFIA pilot program may be 

6 used to carry out any of the following activities with 

7 respect to an eligible project: 

8 (A) Development phase activities, includ9 ing— 

10 (i) planning; 

11 (ii) preliminary engineering; 

12 (iii) design; 

13 (iv) environmental review; 

14 (v) revenue forecasting; and 

15 (vi) other preconstruction activities. 

16 (B) Construction, reconstruction, rehabili17 tation, and replacement activities, including the 

18 training of construction personnel in handling 

19 and safety. 

20 (C) Acquisition of— 

21 (i) real property or an interest in real 

22 property; or 

23 (ii) equipment. 

24 (D) Environmental mitigation activities. 


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1 (E) Activities relating to construction con2 tingencies. 

3 (h) FEDERAL REQUIREMENTS.— 

4 (1) IN GENERAL.—Nothing in this section su5 persedes the applicability of any other requirement 

6 under Federal law (including regulations). 

7 (2) NEPA.—Federal assistance may only be 

8 provided under the HIFIA pilot program for a 

9 project that has received an environmental categor10 ical exclusion, a finding of no significant impact, or 

11 a record of decision under the National Environ12 mental Policy Act of 1969 (42 U.S.C. 4321 et seq.). 

13 (i) LEAK DETECTION.—Each eligible entity that re14 ceives a loan or grant under the HIFIA pilot program 

15 shall conduct— 

16 (1) a hydrogen leakage monitoring, reporting, 

17 and verification (also known as ‘‘MRV’’) program; 

18 and 

19 (2) a hydrogen leak detection and repair (also 

20 known as ‘‘LDAR’’) program. 

21 (j) MAXIMUM FEDERAL INVOLVEMENT.—The max22 imum Federal share of an eligible project for which a loan 

23 is provided under the HIFIA pilot program shall not ex24 ceed 80 percent of the eligible costs of the project. 


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1 (k) AMENDMENT.—Section 1703(b)(3) of the Energy 

2 Policy Act of 2005 (42 U.S.C. 16513(b)(3)) is amended 

3 by striking ‘‘Hydrogen fuel’’ and inserting ‘‘Hydrogen 

4 technologies applicable to 1 or more end-use sectors, such 

5 as power generation, transportation, aviation, storage, in6 dustrial, and chemicals, including hydrogen fuel’’. 

7 (l) TECHNICAL ASSISTANCE.— 

8 (1) IN GENERAL.—The Secretary and the Na9 tional Laboratories may provide technical assistance 

10 under the HIFIA pilot program to assess the grad11 ing and readiness of existing infrastructure to trans12 port, store, or deliver hydrogen with respect to infor13 mal State and regional planning for investments in 

14 that grading and readiness. 

15 (2) PRIORITY.—In providing technical assist16 ance under paragraph (1), the Secretary and the 

17 National Laboratories shall prioritize— 

18 (A) preexisting infrastructure corridors; 

19 (B) geologic storage potential for hydro20 gen; and 

21 (C) industrial clusters. 

22 (m) REGULATORY ASSESSMENT TO ENCOURAGE HY23 DROGEN TRANSPORTATION INFRASTRUCTURE DEPLOY24 MENT.—Not later than 270 days after the date of enact25 ment of this Act, each of the Federal Energy Regulatory 


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1 Commission, the Surface Transportation Board, and the 

2 Administrator of the Pipeline and Hazardous Materials 

3 Safety Administration, in coordination with the Secretary, 

4 shall— 

5 (1) assess jurisdiction over the siting, construc6 tion, safety, and regulation of hydrogen transpor7 tation infrastructure, including, at a minimum, the 

8 blending of hydrogen in natural gas pipelines; 

9 (2) if that assessment indicates that additional 

10 authority is needed to support the deployment of hy11 drogen transportation infrastructure, submit to Con12 gress a report describing the needed authority; and 

13 (3) identify the eligibility of, and process for, 

14 hydrogen transportation infrastructure to receive 

15 cost recovery under the HIFIA pilot program 

16 through Commission-regulated rates, Board-regu17 lated rates, or other applicable regulated rates, as 

18 appropriate, for the transportation of hydrogen in 

19 interstate commerce. 

20 (n) AUTHORIZATION OF APPROPRIATIONS.—There is 

21 authorized to be appropriated to the Secretary to carry 

22 out the HIFIA pilot program $100,000,000 for each of 

23 fiscal years 2022 through 2026. 

Æ 


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