Biden Treasury Dept. Ruins 45V “Clean” Hydrogen Tax Credit

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On Jan. 3, the Biden IRS issued its final clean hydrogen tax credit rule, otherwise known as the 45V Clean Hydrogen Production Tax Credit. We previously wrote about 45V back in June (see Biden IRS 45V Tax Rule Endangers Hydrogen Hub Projects in M-U). Our take back then has not changed with the release of the final rule. The 45V tax credit, part of the misnamed Inflation Reduction Act (IRA), can only be used if the hydrogen produced is “green” — meaning NOT made from natural gas. In addition, the electricity used to produce the hydrogen can’t come from fossil fuel sources like natural gas (if you want the tax credit). From what we can tell, nothing changed between then and now, other than allowing coal-mine methane to qualify for the higher tax credit.

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