By Jeffrey Clark, Advanced Power Alliance
Hydrogen has immense potential to drive American economic growth and job creation, while complementing our diverse energy portfolio – from natural gas and nuclear to solar and wind.
However, the hydrogen production tax credit (45V) that supports the industry’s expansion is at risk of elimination in Congress. If the United States wants to maintain its global energy leadership into the next generation, tax credits like 45V will need to be kept to ensureinvestors and project developers have the flexibility to advance projects.
When 45V was passed, companies across the country began investing to build new hydrogen production facilities. Because of the diverse hydrogen production pathways, every region can compete for market share using locally available resources, all while revitalizing local communities. From Appalachia to the Great Plains and Gulf Coast, communities that have long powered the nation’s energy, manufacturing, and industrial bases have the ability to lead this next chapter.
States like Texas are aggressively developing its hydrogen capacity – including through the Gulf Coast’s HyVelocity Hydrogen Hub. The projects sponsored by the hub will create 35,000 construction jobs and 10,000 permanent jobs. Policy support like 45V makes hydrogen’s economic and job growth potential more feasible.
But if Congress weakens or rolls back 45V, much of that momentum could vanish. Hydrogen projects require long lead times andsignificant capital investment, both of which can be overcome by providing developers and investors with market certainty. Without a stable 45V credit, projects will be cancelled, states will lose out on investment, and the U.S. risks falling behind global competitors like China.
If Congress wants to truly unleash America’s energy potential, they should not only preserve 45V but consider removing longstanding bureaucratic barriers to building new energy infrastructure. We can do this by reforming how projects are permitted and approved for construction —an essential edge we can provide for America’s global competitiveness.
The 45V credit is already delivering results. Walking it back now would send the wrong signal at the worst possible moment – and essentially pull the rug out from under American workers and concedethat the U.S. will no longer lead in energy innovation.
Expanding the US hydrogen industry creates new opportunities for the nation’s existing skilled energy workforce. The credit helps ensure those jobs stay in America. Let’s keep the momentum going. By preserving the 45V tax credit, we can compete and secure America’s long-term energy leadership with hydrogen.