Los Angeles-based Southern California Gas Co. has launched a futuristic research adventure, seeking to use natural gas as the raw material for combining hydrogen energy and various carbon-based byproducts.

The Sempra Energy utility’s vision has won federal energy funding support and research collaboration with the Pacific Northwest National Laboratory (PNNL) and West Virginia University (WVU).

The collaborative project bids to create both hydrogen for fuel cell vehicles and industrial processes, along with carbon fiber used in various medical device, aerospace and building products.

Ultimately, the work could lead to a commercial-scale process by advancing the catalyst deployed and a better understanding of the characteristics of the carbon that it produces, said researchers. However, it’s still unclear what volumes of natural gas would be used in a commercial-scale project.

SoCalGas said the collaborative project is led by a Santa Monica, CA-based startup that was formed late last year, C4-MCP LLC (C4). The startup is part of C4 Composites also formed last year to create “the carbon-to-value economy” by transforming atmospheric carbon dioxide (CO2) into “carbon-negative and price-competitive materials, chemicals and fuels.”

C4’s corporate address is the same as U.S. Renewables Group, an investment firm focused on about two dozen renewable energy start-up firms.

The partnership is working on ways to offset the relatively high cost of hydrogen production with the sale of carbon fiber and carbon nanotubes (CNT). The goal is to slash hydrogen costs to under $2/kilogram.

At that price level, hydrogen-fueled vehicles could be competitive with conventional gasoline/diesel vehicles, a SoCalGas spokesperson said. “In addition, this technology will virtually eliminate CO2 emissions from the methane-to-hydrogen process.”

Pre-commercialization of the venture has secured funding of $750,000 split between federal and private sector sources. The technology is to be developed under a cooperative research and development agreement, with $375,000 from the U.S. Department of Energy and $375,000 from C4 and SoCalGas.

The project is focused on expanding the growing global market for carbon fiber and its uses in CNT, touted as a big advance in materials science and engineering because of the CNTs tensile strength and stiffness compared to carbon fiber, said SoCalGas’s Yuri Freedman, senior director of market development.

Freedman said the technology turns methane into “a zero-emission automotive fuel — hydrogen — then uses the carbon captured in the process to make the strongest possible materials to be used in high-tech manufacturing.”

The catalyst used to make CNTs was discovered by WVU engineering professor John Hu, who is heading the laboratory research leading to the catalyst and process to convert natural gas to crystalline carbon and hydrogen.

“The new catalyst and technique will be further developed and evaluated at both WVU and the national lab, PNNL,” the SoCalGas spokesperson said.

PNNL’s project manager Robert Dagle said the research is to provide “more detail and further develop the catalytic process, understand the characteristics of the carbon that is produced, and help figure out how to economically scale up the process for commercial implementation.”