Tax incentives for hydrogen energy storage power generation

What is the 45v Clean Hydrogen Production Tax Credit?

The 45V Clean Hydrogen Production Tax Credit was established under the Inflation Reduction Act of 2022 to incentivize more hydrogen production with lower greenhouse gas emissions. The tax credit creates a new 10-year incentive for clean hydrogen of up to $3.00/kilogram.

How does the Clean Hydrogen Production Tax Credit work?

The Clean Hydrogen Production Tax Credit creates a new 10-year incentive for clean hydrogen production with up to $3.00 per kilogram. Projects can also elect to claim up to a 30% investment tax credit under Section 48. The deadline for construction has been extended to January 1, 2033.

Will nuclear power plants qualify for the Clean Hydrogen Production Tax Credit?

The U.S. Department of Treasury and Internal Revenue Service recently released the final implementation rules for the Clean Hydrogen Production tax credit. After reviewing over 30,000 public comments, the two agencies made several key changes that could qualify more of the nation’s nuclear power plants to power eligible hydrogen production.

Where can I find information about federal incentives for hydrogen fuel cell projects?

The U.S. Department of Energy Hydrogen and Fuel Cell Technologies Office in the Office of Energy Efficiency and Renewable Energy offers information about federal and state financial incentives for hydrogen fuel cell projects.

Can a hydrogen tax credit be used for electrolysis?

A tax credit for hydrogen produced using electricity has two potential deficiencies (apart from whether the credit itself is large enough). First, the tax credit would be available to electrolysis projects regardless of the source of power. Therefore, the hydrogen produced could result in substantial emissions.

How much money does the federal government give to hydrogen hubs?

The credit goes hand-in-hand with $7 billion in additional federal funding the Department of Energy (DOE) is planning to award to seven regional hydrogen hubs per the 2021 Bipartisan Infrastructure Law (BIL) and another $1 billion DOE has allocated for demand-side hydrogen initiatives. The hydrogen rules have drawn significant interest.