The Blue Hydrogen Dream Hit Reality Check: Why Exxon Just Pumped the Brakes

Exxon Mobil’s pulling the plug (for now) on its mega blue hydrogen plant in Baytown, Texas. The plan was ambitious: pump out 1 billion cubic feet of blue hydrogen daily—basically hydrogen made from natural gas with carbon capture built in.

Here’s the catch: nobody wants to pay for it.

Blue hydrogen is cleaner, sure. Produces water when burned, stores CO2 underground instead of releasing it. But it costs way more than regular hydrogen. And according to Exxon’s CEO, the market just isn’t there. Customers won’t fork over the premium, especially with Europe’s economic wobble crushing demand further.

The company couldn’t even lock down offtake agreements—those binding contracts that let projects like this actually move forward. Without buyers committed upfront, there’s no point building the thing.

This is the messy reality of the energy transition: the technology works, the intentions are solid, but the economics don’t pencil out yet. Exxon says it might resurrect the project if demand picks up, but that’s corporate speak for “we’re shelving this indefinitely.”

It’s a reminder that going green isn’t just about innovation—it’s about creating markets that can actually sustain it.