The Internal Revenue Service has proposed strict rules for green hydrogen production tax credits. Environmental and renewable energy interests are applauding. Fossil fuel and legacy electric generators are fuming. A fight over the final rules, including the federal courts, looks likely.
The Biden administration’s Inflation Reduction Act provided for the hydrogen production tax credits, (known as 45V rules for their place in the tax code) to spur development of what might be an important carbon dioxide-free gaseous energy source. Hydrogen could supplant fossil fuels such as natural gas and petroleum in a wide variety of uses including ground transportation, electric generation, aviation, cement, and steel making.
How hydrogen, found only tightly bound up with other elements, can be produced cleanly is controversial. In a news release, the Treasury Department said, “While clean hydrogen holds considerable potential to reduce emissions across a range of sectors and applications, conventional hydrogen production typically results in significant climate pollution.”
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