- CPS Energy has entered into an agreement with Modern Hydrogen to explore clean hydrogen delivery technology. - The project aims to increase grid resiliency and support cleaner power generation from natural gas. - This initiative responds to the growing demand for electricity due to population growth. - CPS Energy will pilot Modern Hydrogen's technology for converting natural gas into clean hydrogen. - The project is a step toward long-term investments in producing cleaner power at scale as part of CPS Energy's Vision 2027. - CPS Energy's President and CEO emphasized the need for more energy to meet customer demands while committing to the Climate Action and Adaptation Plan. - The project will utilize distributed natural gas pyrolysis technologies to produce hydrogen and solid carbon, avoiding CO2 emissions. - Solid carbon byproduct can be reused in infrastructure projects such as asphalt. - The CEO of Modern Hydrogen praised the project as a significant opportunity for clean power generation and infrastructure development. - The Railroad Commission of Texas chairman highlighted the project's potential to create new markets for Texas natural gas. - The pilot is designed to be scalable while ensuring reliability and affordability for customers. - Successful implementation could aid regional power hubs and alleviate grid strain. - Distributed pyrolysis technology may allow local hydrogen generation with minimal disruption. - CPS Energy is the largest public power company in the U.S., serving over 950,000 electric and 389,000 natural gas customers. - Modern Hydrogen is based in Seattle and specializes in converting natural gas into high-value hydrogen and solid carbon. - The projects aim to enhance the sustainability and value of natural gas resources while reducing emissions.

CPS Energy and Modern Hydrogen Launch Clean Hydrogen Project

The nation’s largest electric and natural gas public power utility taps next-generation Modern Hydrogen technology to explore the delivery of clean hydrogen.

July 22, 2025 (SAN ANTONIO) – CPS Energy announced today an agreement with Modern Hydrogen on a new project to explore the potential for increasing grid resiliency and enabling cleaner power generation from natural gas. This project aims to address the growing demand for power resulting from population growth and increasing electricity loads.

CPS Energy will pilot Modern Hydrogen’s technology to convert natural gas into clean hydrogen as an ongoing gas-decarbonization service. The project represents the first step in a long-term strategic investment in producing reliable, cleaner power at scale, as set forth in CPS Energy’s Vision 2027, which includes a commitment to a diverse power portfolio that incorporates new technologies.

“We need more energy, including natural gas, to serve our customers’ growing needs,” said President and CEO of CPS Energy Rudy D. Garza. “We are committed to San Antonio’s Climate Action and Adaptation Plan (CAAP). By exploring this innovative opportunity to produce clean hydrogen using our existing natural gas system, we are moving forward on our commitment to deliver reliable, affordable, and cleaner energy for our community.”

CPS Energy will be one of a few utilities in the nation to pilot distributed natural gas pyrolysis technologies and carbon capture. Instead of combusting natural gas and releasing or capturing CO2, Modern Hydrogen uses a process to break down the hydrocarbons that are in natural gas, producing hydrogen and solid carbon. The solid carbon is captured and reused in products like asphalt for infrastructure projects.

“San Antonio is making a smart, Texas-led bet on natural gas and clean power generation,” said CEO of Modern Hydrogen Tony Pan. “San Antonio and CPS Energy are showing the promise of American natural gas, for both clean power generation, and for better materials to build our infrastructure. They’re showing the country what it looks like to lead on reliability, energy security, and affordability.”

“Creating new markets for Texas natural gas is both a good energy policy and a long-term investment in the regional economy,” said Chairman of the Railroad Commission of Texas Jim Wright. “Deployments like this show how innovative technologies can unlock new value from the Eagle Ford and other prolific basins. This is about keeping American energy competitive, reliable, and local—exactly the kind of leadership Texans expect.”

The pilot is intended to be scalable while maintaining reliability and affordability for CPS Energy customers. If successful, future deployments of this technology may benefit regional power hubs, fleet depots, or transit systems in reducing grid strain. “I’ve modeled the limitations of electrification and centralized hydrogen,” said University of Houston Petroleum Engineering Professor Christine Ehlig-Economides. “By tapping methane in the existing US pipeline network, distributed pyrolysis is one of the few pathways that may allow ubiquitous local hydrogen generation without massive disruption.”

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About CPS Energy

Established in 1860, CPS Energy is the nation’s largest public power, natural gas, and electric company, providing safe, reliable, and competitively-priced service to more than 950,000 electric and 389,000 natural gas customers in San Antonio and portions of seven adjoining counties. Our customers’ combined energy bills rank among the lowest of the nation’s 20 largest cities – while generating $9.6 billion in revenue for the City of San Antonio for 80 years. As a trusted and strong community partner, we continuously focus on job creation, economic development, and educational investment. We are powered by our skilled workforce, whose commitment to the community is demonstrated through our employees’ volunteerism in giving back to our city and programs aimed at bringing value to our customers. CPS Energy is among the top public power wind energy buyers in the nation and number one in Texas for solar generation.

About Modern Hydrogen

Modern Hydrogen is an energy & materials company based in Seattle, WA. Modern’s proprietary natural gas pyrolysis technology converts regular pipeline natural gas into high-value hydrogen and produces solid carbon, which is used to strengthen asphalt pavement. By producing hydrogen at the point of use, Modern Hydrogen helps utilities and industry extend the value of their existing energy infrastructure and reduce emissions while maintaining energy security and affordability. Backed by top investors and customers, including Bill Gates, NextEra Energy, National Grid, CPSE, and NW Natural, Modern Hydrogen is redefining how natural gas resources can become more valuable and sustainable within and beyond the energy industry.