CAC: Changes to 45V Hydrogen Production Tax Credit Would Be A “Sledgehammer” to Safeguards
Washington, DC – Yesterday, some members of Congress sent the administration a letter advocating several policy changes to the Treasury Department’s 45V Hydrogen Production Tax Credit program that would undermine climate goals and environmental justice, increase energy costs for consumers, weaken the effectiveness of the country’s clean hydrogen program, and put communities at greater risk of health-harming pollution. In response, Margie Alt, Director of the Climate Action Campaign (CAC), issued the following statement:
“The policy changes articulated by some members of Congress in their letter yesterday would severely undermine Treasury’s commonsense proposed rules. The recommendations would lead to billions of additional tons of dangerous carbon pollution and double-digit percentage increases in electricity prices for U.S. households and businesses, and it would cost taxpayers hundreds of billions of dollars. These policy changes would be a giveaway to fossil fuel interests and take a sledgehammer to critical safeguards that benefit communities across America. We remain committed to working constructively with the administration and congressional leaders to finalize the 45V credit in ways that minimize its risks and maximize its benefits.”
Background:
In December 2023, the Biden administration proposed strong guidance to implement the 45V tax credit, closely and necessarily adhering to the underlying statutory text and the intent of the Inflation Reduction Act to decarbonize the U.S. economy. The proposal adheres to overwhelming evidence in support of the three pillars of 1) incrementality; 2) deliverability; and 3) hourly matching as necessary to prevent large pollution increases from hydrogen production, in violation of section 45V’s statutory requirements. The three pillars have also been robustly demonstrated to provide the support necessary for the clean hydrogen industry to be a viable part of the clean energy economy. The final version of the rule must uphold these three pillars for electrolytic hydrogen, while preventing dangerous loopholes for fossil-based hydrogen like flawed methane accounting and carbon-negative offsets.
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About CAC
Climate Action Campaign (CAC) is a vibrant coalition of advocacy organizations working together to drive ambitious, durable federal action to cut carbon pollution, address the climate crisis, advance environmental justice, and accelerate the transition to clean energy. Our goal is to reduce carbon pollution and accelerate the transition to clean energy through policies focused on climate, justice, and jobs and expanding opportunity for all.
