The IRA includes the Clean Hydrogen Production Tax Credit
and other incentives for hydrogen technologies.
Hydrogen Forward, a coalition of companies that spans the hydrogen value chain and work to ensure hydrogen is a key contributing solution to the energy transition, applauds the passage of the Inflation Reduction Act (IRA) of 2022 by the House of Representatives. The IRA was passed by the Senate on August 7 and now goes to the President to sign into law. In response to the IRA’s passage, Hydrogen Forward released the following statement:
“The passage of the IRA represents a significant step forward for the broader hydrogen industry. The Clean Hydrogen Production Tax Credit will provide the regulatory certainty needed by industry to invest and scale the deployment of clean hydrogen throughout the United States. The federal government’s actions, through the IRA and the Infrastructure Investment and Jobs Act of 2021, demonstrate the nation’s commitment to achieving ambitious economy-wide decarbonization goals, with hydrogen playing a prominent role in those efforts. Hydrogen’s unique characteristics will help decarbonize hard-to-abate sectors in the U.S., including power generation, transportation, heating and industry. This sustained investment will spur the innovation needed to realize hydrogen’s potential across the country.”
The IRA also includes other incentives to support the scale-up of hydrogen, including:
· Extension of the Section 48 Investment Tax Credit for fuel cells and adding hydrogen storage to the credit.
· Reinstatement of the Alternative Fuel Refueling Property Credit for ten years and raising the cap for hydrogen fueling stations to $100,000.
· Creation of a new Clean Vehicle Credit that provides $7,500 in credits for new purchases and up to $4,000 for used clean vehicles (hydrogen fuel cell electric vehicles qualify).
· Creation of a new Commercial Clean Vehicle Credit that provides up to $40,000 for fleet operators to apply to fuel cell electric trucks and buses.
An initial analysis by the BlueGreen Alliance found that the IRA’s energy and climate provisions could create up to 9 million jobs, with the clean energy tax provisions contributing up 5 million jobs. According to the Princeton University ZERO Lab, the IRA will cut annual emissions in 2030 by an additional ~1 billion metric tons below current policy, which is nearly two-thirds of the emissions gap between current policy and the Biden Administration’s 50-52 percent by 2030 reduction target.