Forbes Piece: IRS 45V Rule Holds The Key To The Future Of U.S. Hydrogen

Jennifer Granholm, US energy secretary, listens as US President Joe Biden speaks in the Roosevelt Room of the White House in Washington, DC, US, on Monday, Oct 31, 2022. Photographer: Al Drago/Bloomberg

[Note: This piece is also published at Forbes.com]

On Friday, President Joe Biden and Secretary of Energy Jennifer Granholm announced the selection of seven regional clean hydrogen hubs. These hubs will be targeted with shares of $7 billion allocated by the 2021 Bipartisan Infrastructure Law to help accelerate the domestic market for hydrogen in the United States. But the future viability of the hubs will be largely influenced by the Treasury Department’s interpretation of a key tax credit designed to jumpstart the industry.

More than a year after the passage of the 2022 Inflation Reduction Act into law, the U.S. Treasury Department’s IRS regulations governing the Section 45V hydrogen tax credit remain unresolved. This delay in finalizing the needed rule clarifying which projects will and will not qualify to benefit from the credit is the source of much concern from a broad variety of potential stakeholders.