Hydrogen Industry Seeks Flexibility in US Tax Credit Environmental Requirements

This week, key players in the emerging hydrogen sector appealed to the Treasury Department to relax proposed environmental criteria tied to the new U.S. tax credits, arguing that these rules might impede industry growth, writes Hydrogen Central. During hearings hosted by the Treasury and the IRS, companies and industry groups voiced concerns over the stringent requirements set forth for the Clean Hydrogen Production (45V) tax credit, a significant incentive introduced by the 2022 Inflation Reduction Act aiming to bolster clean hydrogen production with up to $3.00 per kilogram over ten years. Critics, including Australian company Fortescue and various industry and environmental groups, debated the necessity and impact of these requirements, which mandate the use of newly built, regional clean electricity sources closely aligned in time with hydrogen production. While some argue for more leniency to encourage investment and project development, others stress the importance of strict criteria to achieve climate goals and maintain the hydrogen industry's credibility.