Funded by billionaire Bill Gates, a secretive local Denver startup is developing green energy technology that could potentially tap a $1 trillion market.

Denver-based company Koloma is developing methods to extract hydrogen more effectively, using proprietary technologies and AI, according to a recent report from Forbes.

Koloma has quietly raised $91 million from Gates’s Breakthrough Energy Ventures, Energy Impact Partners, Evōk Innovations, Prelude Ventures and Piva Capital, making it the most well-funded startup in the space.

Co-founder Tom Darrah is listed on 16 filed patents for finding and efficiently extracting hydrogen. He hopes to find the resource in areas where companies have traditionally drilled for oil and gas.

Worldwide, 100 million metric tons of hydrogen are consumed annually, a market worth more than $120 billion, according to Goldman Sachs. The U.S. Government has also earmarked funds for hydrogen in recent years. In November 2021, President Joe Biden signed an infrastructure bill which included $62 billion for the U.S. Department of Energy, including $9.5 billion for clean hydrogen. The following fall, the Inflation Reduction Act introduced additional policies and incentives for hydrogen including a production tax credit that has further boosted a U.S. market for clean hydrogen.

The company could expect even more financial opportunity on the horizon. Goldman Sachs estimates the hydrogen market will double to $250 billion by 2030 and top $1 trillion annually by 2050.

Substantial financial incentives in the United States are currently focused on promoting “green” hydrogen, produced from water and renewable energy sources, as well as “blue” hydrogen, derived from natural gas with carbon capture technology to prevent emissions into the atmosphere. However, Koloma proposes that geologic hydrogen, also referred to as natural hydrogen, native hydrogen, white hydrogen, or gold hydrogen, presents a significantly more cost-effective and energy-efficient alternative.

Geologic hydrogen is hydrogen that is naturally produced or present in the Earth’s crust. 

According to the U.S. Geological Survey, exploration for geologic hydrogen resources is likely to employ many of the same strategies and technologies that are currently used in the extraction of oil and natural gas. However, unlike natural gas, some of the gas in natural hydrogen fields may be renewable given the rapid rate of hydrogen generation via water reduction.

“The idea of geologic hydrogen emerging as a fuel-of-choice is very exciting,” said Joel Johnston, who specializes in environmental and regulatory issues and large infrastructure projects at law firm Hall Estill in its Denver office. “We have seen projects emerge over the past few years focused on green hydrogen produced by re-purposed wind farms, but the idea that a virtually limitless supply of hydrogen could be economically available is game changing.”

Currently, about 40 percent of globally produced hydrogen is made from coal, a more carbon-intensive and polluting process than pulling it from natural gas. Experts believe the commercial production of geologic hydrogen is just a few years, not decades, off.

“What will be interesting to see is how widespread economic deposits of geologic hydrogen are. With the growth of the hydrogen market anticipated to be significant between now and 2050, coupled with the hope of a carbon-free source of energy, this is truly a very, very exciting development,” Johnston said. “We’ve got most of the technical knowledge to drill wells to extract explosive gases from the subsurface, so with some enhancements to extractive technology, and improved understanding of where the most prolific and accessible deposits are located, the geologic hydrogen industry appears to be on the cusp of a potentially revolutionary development.”

With its plans to increase and streamline production for geologic hydrogen using its unique patents, and with the backing of the government and big investors like Gates, Koloma looks to capitalize big on a new green energy revolution.