WGHI Brief | Understanding 45V and the Three Pillars
Clean hydrogen is largely recognized as a crucial element in nationwide efforts to reduce carbon emissions, prompting federal and state governments to implement measures to ensure its safe and equitable adoption. The Inflation Reduction Act (IRA) of 2022 marked the largest single investment in climate and energy in American history, offering numerous grant funding opportunities and tax credits. Among these is the 45V Clean Hydrogen Production Tax Credit, providing up to $3 per kilogram (kg) of hydrogen for projects emitting less than 4 kg of carbon dioxide per kg of hydrogen on a lifecycle basis. This tax credit supplements other federal initiatives in the clean hydrogen sector, including the Department of Energy's Regional Clean Hydrogen Hubs program, which allocates $7 billion across seven hydrogen hubs.
With final regulations on 45V still underway, this brief delves into the findings discussed during the Western Green Hydrogen Initiative’s (WGHI) most recent webinar regarding 45V’s potential to accelerate clean hydrogen market liftoff in the U.S. Learn about the three pillars and several key themes that emerged amongst the 30,000 comments received by the Treasury as well as state considerations for maximizing the efficacy of the 45V tax credit.