Shannon Van Hoesen, shannon.vanhoesen@sierraclub.org
Washington, DC - Today, the U.S. Department of Treasury released draft guidance for the Inflation Reduction Act’s 45V tax credits for hydrogen that will encourage production of the cleanest versions of the fuel, resisting pressure from the fossil fuel industry to propose weaker standards.
In order to claim the highest level of the tax credit, producers of green hydrogen will be required to ensure the energy used to power their operations from clean sources is newly built specifically for their purposes within the previous three years. Producers will have to track their energy sources on an hour-to-hour basis starting in 2028. The proposal will also take into account methane emissions and leakage for fossil-based hydrogen production.
In response, Sierra Club Director of Climate Policy Patrick Drupp said:
“Clean hydrogen production, with appropriate end uses, has important potential, but without critical guardrails, hydrogen could actually increase climate emissions and air pollution and derail our clean energy progress. With this new guidance, we can see the Biden administration is making the right choices for ensuring only truly clean hydrogen is eligible for the highest credit, enabling heavy industry to decarbonize without rewarding dirty hydrogen production. We urge the Administration to finalize strong standards that fully reflect the total emissions impact of hydrogen production to protect communities and our climate.
About the Sierra Club
The Sierra Club is America’s largest and most influential grassroots environmental organization, with millions of members and supporters. In addition to protecting every person's right to get outdoors and access the healing power of nature, the Sierra Club works to promote clean energy, safeguard the health of our communities, protect wildlife, and preserve our remaining wild places through grassroots activism, public education, lobbying, and legal action. For more information, visit www.sierraclub.org.