US Trade Body Awards $5.7M for Green Hydrogen Study in Morocco Despite Trump’s Energy Shift

A Grant Links Washington, Rabat, and Western Sahara

The U.S. Trade and Development Agency (USTDA) has awarded a $5.7 million grant to the Moroccan joint venture ORNX to conduct a feasibility study for a green ammonia facility in Laâyoune, a city in the disputed Western Sahara region. The study will evaluate electrolyzer systems from Massachusetts-based Electric Hydrogen (EH2), a well-funded U.S. startup backed by Microsoft, Breakthrough Energy, and oil major bp.

The grant was formally handed over just days after Morocco named a $1 billion highway after U.S. President Donald Trump, and U.S. Ambassador Duke Buchan III declared “America is in the Moroccan Sahara” at the signing ceremony. The move reinforces Washington’s 2020 recognition of Moroccan sovereignty over the territory, a claim contested by the Algeria-backed Polisario Front.

The project is part of Morocco’s ambitious “Morocco Offer” green hydrogen investment plan, which in March 2025 tapped six consortia to develop six projects across three southern regions at a total projected cost of 319 billion dirhams ($87 billion). ORNX’s planned facility would produce 560,000 tonnes of green ammonia annually, using renewable electricity and electrolysis. The grant, though modest, opens a door for U.S. technology in a sector that the Trump administration has otherwise deprioritized at home.

Geopolitics, Technology, and the Uneven Economics of Green Hydrogen

The Geopolitical Calculation

The grant is as much about foreign policy as energy. By funding a project in Western Sahara, the U.S. reinforces its diplomatic backing for Morocco’s territorial claims, a stance that has strategic value in a region where Algeria and other powers compete for influence. The location could complicate offtake agreements with the European Union, which classifies Western Sahara separately under trade rules, but for now the signal is clear: the U.S. sees the region as part of Morocco.

Morocco’s Hydrogen Ambitions and the $87 Billion Bet

Morocco’s green hydrogen blueprint envisions exporting ammonia to European markets hungry for low-carbon feedstocks. The selection of six projects—most targeting ammonia production—reflects serious government backing and some of the world’s best solar and wind resources. Yet the scale is enormous: the 319 billion dirham figure equals roughly 40% of Morocco’s annual GDP, requiring massive international financing and offtake commitments that are not yet secured.

Electric Hydrogen’s Role and the Cost Question

EH2 is betting that its electrolyzer manufacturing approach—designed for high-throughput, low-cost production at its Devens, Massachusetts factory—can slash the cost of green hydrogen. The company has raised more than $700 million and previously received a $46.3 million U.S. Department of Energy grant under the Bipartisan Infrastructure Law. If the USTDA-funded study confirms that EH2’s technology can deliver at scale in Morocco, it could accelerate the global shift toward cost-competitive green ammonia, even as the Trump administration pulls back from domestic clean energy support.

Policy Irony: Green Funds from a Fossil-Friendly Administration

The grant comes from an independent federal agency, not the White House itself, but it still cuts against President Trump’s relentless push to unwind climate programs. Notably, the U.S. has continued to fund green projects abroad via the USTDA and the Export-Import Bank, even as it halts domestic initiatives. This dissonance reflects the reality that clean energy exports remain a bipartisan business interest, and that strategic foreign policy priorities can override ideological purity.

What the Moroccan Project Means for Energy Investors and Policy Watchers

• Track Electric Hydrogen’s feasibility study results, expected within 12–18 months, as an early signal of whether its electrolyzer manufacturing model can achieve the low costs needed for large-scale green ammonia.
• Monitor the financing milestones of Morocco’s six hydrogen consortia—particularly final investment decisions—because their success or failure will indicate whether the global green hydrogen pipeline is moving from plans to construction.
• Assess potential offtake agreements from European fertilizer and chemical companies, given that ammonia imports from Western Sahara may face legal challenges under EU trade law, creating a risk premium.
• Note the U.S. diplomatic posture: the Trump administration’s willingness to use trade agencies for clean energy projects abroad, especially in allied nations, suggests that some U.S. firms may still find government backing overseas even if domestic policy remains hostile.