💡 What if the price of clean hydrogen dropped by 90%? Right now, producing "green hydrogen" costs around $5 per kilogram. A U.S. startup says it could bring that down to just $0.50/kg— by accelerating a chemical reaction that's been happening beneath the Earth's surface for millennia. And here's the kicker: Japan's own geology may hold the key to finally achieving its long-held dream of a "hydrogen society."
What Is Engineered Mineral Hydrogen?
In February 2026, U.S. startup Vema Hydrogen announced it had completed drilling the world's first two pilot wells for "Engineered Mineral Hydrogen™" (EMH) in Quebec, Canada. The milestone marks the transition of this technology from laboratory research to real-world field testing.
The underlying science is elegantly simple. Deep beneath the Earth's surface, iron-rich minerals such as olivine naturally react with water through a process known as "serpentinization," producing hydrogen gas. This reaction has been occurring naturally for thousands of years across the planet.
The problem? Nature takes its time. Vema's breakthrough lies in artificially accelerating this natural process. The company injects a catalyst-enhanced brine solution into shallow rock formations, stimulating the iron-bearing minerals to react with water and generate hydrogen at commercially viable rates. The hydrogen is then recovered through wells drilled into the formation.
Think of it like oil drilling—but with zero CO2 emissions. And unlike fossil fuels, this process can be strategically deployed wherever the right rock formations exist.
Why a 90% Cost Reduction Is Possible
Understanding hydrogen's cost problem requires knowing its "color spectrum." Conventional "gray hydrogen," made from natural gas, is cheap (around $0.70–$1.60/kg) but produces significant CO2 emissions. "Green hydrogen," produced by splitting water with renewable electricity, is clean but expensive—roughly $5/kg—creating a major barrier to adoption.
Vema Hydrogen projects that EMH could eventually be produced for less than $0.50 per kilogram. If achieved, this would make it simultaneously among the cleanest and cheapest forms of hydrogen available.
The economics work because EMH leverages the Earth itself as both raw material and energy source. Traditional green hydrogen requires massive electrolyzers and enormous amounts of renewable electricity. EMH needs neither. As Vema puts it, "Most of the work is performed by the Earth itself." The iron-rich minerals that serve as feedstock are among the most abundant materials in the planet's crust and mantle.
The Quebec Pilot: From Lab to Field
Quebec was chosen for its geological suitability. Eastern Canada features ancient geological formations rich in olivine and other iron-bearing minerals, including ophiolites and banded iron formations (BIF)—ideal candidates for EMH production.
Through the two pilot wellbores, Vema will conduct subsurface analysis to evaluate fluid movement and monitor hydrogen generation. The data gathered will refine commercial models and guide the next phase: drilling the first commercial well reaching 800 meters depth, planned for 2027. Even the pilot wells are expected to produce several tons of hydrogen per day.
Vema's commercial momentum is already building. In December 2025, the company signed a 10-year hydrogen purchase agreement with Verne Power to supply clean hydrogen for data centers across California, with operations beginning as early as 2028. Vema has also been recognized as a Qualified Supplier by California's First Public Hydrogen Authority (FPH2).
"This pilot will provide the critical data needed to validate Engineered Mineral Hydrogen at commercial scale," said Pierre Levin, Vema's CEO. "The quality of the rock within our core samples is exactly what we expected, and is very promising for hydrogen yields."
What This Means for Japan
Here's where the story gets particularly interesting for Japan. According to maps published on Vema Hydrogen's website, candidate sites for EMH production exist in Japan's Tohoku (northeastern) and Kyushu (southwestern) regions.
This aligns with Japan's geological reality. Sitting atop multiple tectonic plate boundaries, Japan has unusually accessible deposits of olivine-rich rock. At the Hakuba Happo Onsen hot spring in Nagano Prefecture, natural hydrogen produced through serpentinization has already been documented—making it Japan's only known "natural hydrogen hot spring."
Japanese institutions are already pursuing this frontier. In 2025, Kyushu University and Kyushu Electric Power began a NEDO-funded research project exploring natural hydrogen commercialization in the Kyushu region. Tohoku University also received NEDO funding for research on enhanced hydrogen recovery from ultramafic rocks. And JOGMEC (Japan's energy and mineral resources agency) has launched domestic surveys to identify natural hydrogen generation sites.
The stakes for Japan are enormous. With an energy self-sufficiency rate of only about 13%—among the lowest of any developed nation—Japan imports the vast majority of its energy. If EMH technology can be deployed domestically, it could fundamentally alter this dependence.
Japan has been a global pioneer in hydrogen policy, publishing the world's first national hydrogen strategy in 2017. The revised 2023 strategy targets 12 million tons of annual hydrogen deployment by 2040 and 20 million tons by 2050, backed by approximately $100 billion in combined public-private investment. The "Hydrogen Society Promotion Act" passed in 2024 provides a legal framework.
Yet current projections suggest that even by 2050, domestic production would cover only about 30% of demand, with the rest imported from overseas. EMH could be the game-changer that rewrites these projections entirely.
Won't the Resources Run Out?
A natural concern is resource depletion. Vema Hydrogen addresses this directly, stating that "even if hydrogen replaced all fossil fuels, thousands of years' worth of hydrogen exists in the Earth's subsurface."
This isn't just corporate optimism. USGS research geologist Geoffrey Ellis has estimated that the Earth could supply global hydrogen demand for thousands of years. Mass balance models supported by the USGS suggest between 1 billion and 1 quadrillion tons of natural hydrogen may exist underground—vastly exceeding current global demand of approximately 97 million tons per year.
Just as "oil money" shaped the 20th century's geopolitics, "hydrogen money" could reshape the 21st century's energy landscape.
A New Factor in Data Center Location Strategy
The implications extend beyond energy policy. As AI-driven demand causes data center power consumption to surge worldwide, EMH could introduce a new variable into site selection.
Traditionally, data centers are built where electricity is cheap and cooling is easy. But if clean, affordable hydrogen can be produced underground and converted to electricity on-site, locations with the right geological formations become attractive data center sites. Vema's partnership with Verne Power for California data centers reflects exactly this logic.
In Japan, where data center distribution to rural areas is already underway, the convergence of hydrogen resources and computing infrastructure could create a unique virtuous cycle—simultaneously advancing regional revitalization and energy independence.
Challenges Remain
To be clear, significant hurdles persist. EMH technology is still in the pilot phase, and whether commercial-scale production is viable depends on forthcoming data. JOGMEC reports note that natural hydrogen reserves remain unquantified, and economic feasibility assessments are premature.
In Japan specifically, detailed geological surveys, drilling and refining technology development, environmental impact assessments, and public consensus-building all lie ahead. Earthquake risk evaluation—uniquely critical for Japan—adds another layer of complexity.
Still, global momentum is unmistakable. The number of companies exploring natural hydrogen has quadrupled since 2020. France has amended its mining code to include natural hydrogen. The U.S. Department of Energy has allocated $20 million to natural hydrogen projects. And the USGS published a natural hydrogen potential map for the continental United States in January 2025.
A 90% drop in hydrogen costs isn't just a technological milestone—it's a potential rewriting of energy geopolitics. For Japan, a nation long described as "resource-poor," the idea that a vast energy source may lie beneath its own soil is nothing short of revolutionary. The "hydrogen society" (suiso shakai) that Japan has envisioned since 2017 might just begin from the ground up—literally.
How is hydrogen energy being developed in your country? Do you see potential in underground geological hydrogen? We'd love to hear your thoughts and how your country is approaching the hydrogen challenge.
References
- https://www.globenewswire.com/news-release/2026/02/03/3230886/0/en/Vema-Hydrogen-Drills-Pilot-Wells-in-Quebec-for-World-s-First-Engineered-Mineral-Hydrogen-Test-Project.html
- https://www.vema.earth/
- https://www.enecho.meti.go.jp/category/saving_and_new/advanced_systems/hydrogen_society/
- https://www.jogmec.go.jp/publish/plus_vol19.html
- https://www.mizuho-rt.co.jp/business/consulting/articles/2025-k0021/index.html
- https://www.technewsworld.com/story/pilot-wells-lay-groundwork-for-hydrogen-powered-energy-production-180152.html
- https://www.kankyo.tohoku.ac.jp/activity/a20250604.html
Reactions in Japan
Engineered mineral hydrogen has finally reached the pilot stage. Japan's hydrogen strategy assumed importing from overseas, but if domestic production at $0.50/kg becomes reality, it fundamentally changes the game. The candidate sites in Tohoku and Kyushu need geological surveys immediately.
They're saying 90% off, but they've only drilled two pilot wells so far. How many projects have died between lab, pilot, and commercialization? Let's not get our hopes up too much. Also, Japan's earthquake risk is on a completely different level from Canada.
Is it true that Tohoku has candidate sites? Our prefecture keeps losing population, but if we became a hydrogen production area, it could create jobs and help regional revitalization. It's a bit of a dream, but an exciting one.
Hydrogen generation from serpentinization is common knowledge in geology, but the idea of scaling it industrially is fascinating. Japan is known for Hakuba's olivine body, but there are quite a few other areas with serpentinite mélange and the Sanbagawa belt. I can't wait for the potential surveys.
The lack of hydrogen stations has been a constant frustration, but if hydrogen prices drop to 1/10, would infrastructure development accelerate? Half hopeful, half resigned... For now, I just pray my local hydrogen station doesn't close down.
Another startup making grandiose claims. I'm tired of the pattern—TeraPower, fusion, etc.—talking big dreams, raising money, and delivering nothing. Write articles after they achieve commercial operation, please.
When will household hydrogen actually become affordable? I'm aiming for self-sufficiency with solar panels and an Ene-Farm, but cheaper hydrogen would expand my options. It takes so long for tech breakthroughs to reach households though...
I didn't know Hakuba Happo Onsen is a natural hydrogen hot spring! So hydrogen is generated through serpentinization—I was experiencing cutting-edge energy while soaking in a hot spring. I'll probably look at it differently next time I visit lol
The hydrogen FCV market where Toyota has been fighting alone could suddenly open up through this kind of upstream breakthrough. If hydrogen becomes cheap, FCV running costs could match or beat EVs. Maybe Toyota's hydrogen strategy was just too far ahead of its time.
Artificially accelerating underground chemical reactions—won't this become another fracking disaster? I'm worried about groundwater contamination and ground subsidence. Just because it's cheap doesn't mean anything goes without proper environmental assessment.
Hydrogen truly shines in industrial applications like steelmaking and chemical industries. If costs drop dramatically, decarbonizing the steel industry becomes realistic. This could be a major tailwind for Nippon Steel's and JFE's hydrogen-based steelmaking efforts.
If Japan with its 13% energy self-sufficiency could produce domestic hydrogen, the national security implications are immeasurable. Middle East dependency, Russia risk, vulnerability of sea lanes—all assumptions change. The Ministry of Defense should be watching this technology.
Power costs exceed 40% of our DC expenses. If hydrogen power becomes cheaply available, we'd need to rethink our location strategy and power mix from scratch. But this is still a 'someday' story, right? I want to see actual results from the 2028 Verne project before making any judgments.
Vema has raised funds from Extantia and others, but Japanese VCs are barely touching this space. Geological hydrogen has potential in Japan too—are we going to let America take the lead again? Instead of waiting for JOGMEC's surveys, the private sector needs to move.
I love the phrase 'the Earth does most of the work.' All humans do is drill wells and inject catalyst-enhanced water. The rest is just accelerating a reaction the Earth has been doing for millennia. It's the simplicity that gives it the potential to scale.
On top of Kyushu University and Kyushu Electric's NEDO-funded natural hydrogen research, now EMH technology is emerging from overseas. Kyushu has a chance to become an energy-leading region with hydrogen, following geothermal and solar. Industry, academia, and government need to seriously collaborate.
"Hydrogen money" instead of oil money—what a catchy phrase. A future where Japan rises on hydrogen like Saudi Arabia rose on oil... Am I getting too carried away? But the fact that it's not zero probability is what makes it exciting.
France has already amended its mining law to include natural hydrogen. Japan passed the Hydrogen Society Promotion Act, but has no legal framework for underground hydrogen generation and extraction. Even if technology advances, industrialization will lag if laws don't keep up.
Sweden leads the world with the HYBRIT hydrogen-reduced steelmaking project, but hydrogen cost has been our biggest challenge. If EMH truly achieves $0.50/kg, the economics of green steel would fundamentally improve. We should investigate whether Nordic geology is suitable for this too.
India targets 5 million tons of green hydrogen by 2030, but electrolyzer costs are a barrier. If we can make hydrogen from underground minerals, the Deccan Plateau's basalt formations might hold enormous potential. This technology offers hope for developing nations too.
I've worked 20 years in Texas oil & gas, and EMH's drilling process directly transfers our industry's skills. As we face calls for industrial transition, it's great news that oil drilling technicians could shift to hydrogen drilling. But investors won't move until they see performance data.
Since the discovery of a natural hydrogen deposit in France's Lorraine region in 2023, our country has been among the fastest to establish legal frameworks for natural hydrogen. It's interesting that Japan's Tohoku and Kyushu also have candidate sites. Volcanic geology might work in their favor.
Germany aims for 10 GW hydrogen production capacity by 2030, but domestic renewables aren't enough, so we depend on imports. If EMH works in European geology, ophiolite belts in North Africa and the Iberian Peninsula could be promising. We share the same import dependency challenge as Japan.
Australia already has Gold Hydrogen exploring for natural hydrogen on the Yorke Peninsula. Whether EMH's artificially accelerated approach or pure natural hydrogen extraction wins economically will be fascinating. The competition is about to get serious.
Saudi Arabia is building the world's largest green hydrogen plant as part of the NEOM project. If EMH truly achieves $0.50/kg, our $10+ billion investment could suddenly lose competitiveness. This is as much a threat as an opportunity for the Middle East.
South Korea also targets 5.26 million tons of hydrogen supply by 2040 and, like Japan, is an energy importer. Interestingly, KNOC has already begun natural hydrogen potential surveys. If Japan and Korea shared geological data, it could transform East Asia's entire hydrogen strategy.
In Brazil, natural hydrogen seeps have been known for some time—circular patterns of dead vegetation called 'fairy circles' are signs of hydrogen emission. While EMH accelerates natural hydrogen generation, ecological impact assessments should be conducted carefully.
In Ireland, data centers consuming over 20% of electricity has become a social issue. The point about hydrogen power changing data center location criteria is sharp. If we can distribute DCs to geologically favorable locations, it would also reduce grid stress.
China produces over 35 million tons of hydrogen annually—the world's largest—but most is coal-derived gray hydrogen. If low-cost clean hydrogen tech like EMH matures, it could accelerate the transition away from coal hydrogen. However, whether China's interior has olivine deposits needs investigation.
Italy has one of Europe's most significant ophiolite belts in Liguria. If EMH technology can be applied here, it would greatly contribute to EU energy self-sufficiency. Japan and Italy share similar geological challenges—I'd love to see knowledge sharing between our countries.
Since natural hydrogen was discovered at Bourakebougou in Mali, hopes for hydrogen resources in Africa have been rising. If EMH can work with Africa's ancient shield regions and iron formations, it might help address energy poverty. I hope this doesn't become technology only for developed nations.
As a Quebec resident, safety and environmental impact of the pilot project concern me most. The Thetford region is known for former asbestos mines. It would be wonderful if a mining-scarred region could be revitalized through hydrogen, but full disclosure to residents is a prerequisite.
Chile has over 1,800 GW of renewable potential and aims to become a green hydrogen export powerhouse. If EMH hits $0.50/kg, Chilean green hydrogen could lose price competitiveness. We may need to differentiate through hydrogen quality and certification systems.