The Biden administration issued guidelines for a hydrogen production tax credit aimed at encouraging companies to produce hydrogen from renewable energy sources. But the industry has mixed comments, with some arguing that the tax credit is too strict and could stifle the hydrogen industry.
local time, the Biden administration issued guidelines for obtaining tax credits for hydrogen production, hoping not to increase greenhouse gas emissions in the process of developing the hydrogen energy supply chain.
In 2022, Biden signed the Inflation Reduction Act, which provides $100 billion in subsidies for hydrogen production, encouraging companies to produce more hydrogen from renewable energy and other carbon-free sources.
Who can apply for this part of the tax credit has become a concern.
At present, most of the electricity in the United States still comes from coal and natural gas power plants, so if a company simply plugs a bunch of electrolyzers into the existing grid to produce hydrogen, greenhouse gas emissions are likely to increase. Similarly, if a hydrogen company tries to use power from an existing wind or solar plant, other coal or natural gas plants will operate more frequently to make up for that power.
Some studies suggest that without adequate safeguards, tax credits could inadvertently result in hundreds of millions of tons of additional CO2 emissions.
In order to avoid this outcome, the Ministry of Finance has proposed several restrictions. To receive the full tax credit, hydrogen producers must take advantage of new sources of clean electricity built within the last three years. These plants must be located in the same grid area as the hydrogen plant. And, starting in 2028, producers will have to prove every hour that the electricity used by their electrolyzers comes from new renewable energy projects, meaning that electrolyzers can only operate on the same hour that clean electricity is available.
Some experts say new rules are needed to ensure that the development of the hydrogen supply chain does not increase pollution. Clean energy trade groups, meanwhile, argue that the tax credit is too restrictive and could stifle the hydrogen industry. Eric Guter, vice president of hydrogen at Air Products & Chemicals, the
world's largest hydrogen producer, said: "The US tax subsidy for hydrogen is the highest in the world, so we believe it should adopt the strictest standards for cleanliness." The company is developing a $4 billion project in North Texas with American Electric Power Company (AES) that will produce hydrogen from wind and solar energy. Tech companies such as
Microsoft and Google have set targets to procure local renewable electricity and match purchases by the hour to encourage clean energy growth in a similar way. The American Clean Energy Association, which
represents major wind, solar and transmission companies, says that starting in 2028, companies will need to prove every hour that the electricity used in the electrolyzer comes from new renewable energy projects, which is too stringent. The rule "will prevent the vast majority of clean energy companies from investing in green hydrogen manufacturing and facilities," Jason Grumet, the
group's chief executive, said in a statement.
Currently, producers are only required to certify electricity as clean energy each year, but this may lead to electrolysis facilities being powered by fossil fuels when no additional clean energy is available in the region.
The Inflation-Reduction Act also allocated $ 7 billion to establish hydrogen production "hubs" across the United States. Clearly, the Biden administration sees hydrogen as a key part of America's clean energy future.
Still, many grassroots groups are concerned about the potential impact of the hydrogen industry on local communities and the environment. They do not want facilities that use methane to produce hydrogen to cause air pollution, nor do they believe in emerging carbon capture technologies. The strict rules in the
guidelines could also shatter the dreams of some older nuclear plants that thought they could break new ground in the hydrogen business. Constellation, the largest operator of nuclear power plants in the United States, may file a lawsuit to prevent the guidelines from taking effect, according to the Huffington Post. In 2023,
the company announced plans to build a $900 million nuclear-powered clean hydrogen production facility in Illinois with funding from the Biden Administration's Hydrogen Center Program. But if nuclear energy does not come from new power plants or recent capacity additions at existing plants, it could lose the hydrogen tax credit.
Building a new nuclear reactor is an extremely difficult task. America's first new reactor in decades finally came online in 2023. Seven years behind schedule and more than $16 billion over budget.
Treasury will accept public comments for 60 days and may make changes before finalizing the plan.
"This policy is going to make it harder for everyone." Jacob Susman, CEO of clean hydrogen developer Ambient Fuels, said the company had been planning to invest about $700 million in new projects . "There's going to be a lobbying frenzy around the final rule," said Rachel Fakhry, director of emerging technology policy at the Natural Resources Defense Council,
an environmental group. We are watching closely to ensure that there are no new loopholes that are harmful to emissions or consumers. It is not clear how much clean hydrogen will actually be produced in the
United States in the coming years. The Biden administration has a strategy to produce 50 million tons of clean hydrogen by 2050, more than 50 times the current production. There are still huge obstacles to building a hydrogen transport system and finding a buyer for the fuel.
浙公网安备33010802003254号