05:46 AM EDT, 04/09/2024 (MT Newswires) -- US manufacturers specializing in chemicals and petroleum refining have traditionally accounted for the largest shares of hydrogen consumption and production, but new legislation could change how hydrogen is consumed and distributed, the US Energy Information Administration reported Monday.

Refiners and chemicals manufacturers tend to have more buying power than other manufacturing subsectors because they use more hydrogen, the EIA said.

Within these two industrial subsectors, petroleum refiners used 68% of all US hydrogen production and nitrogenous fertilizer industries used 21%. The large-scale use of hydrogen helps manufacturers negotiate low prices in their contracts to secure feedstock, the agency said.

Large industrial hydrogen consumers are also capable of generating their own hydrogen or using hydrogen produced as a byproduct of chemical processes at nearby facilities.

Since 2018, there have been federal policy efforts to increase hydrogen production using alternative processes and to expand hydrogen distribution networks within different regions of the US. Given these new policies, the EIA expects hydrogen supply to expand in the US and consumption by current and new industrial consumers to grow.