Biden proposes climate stipulations for hydrogen tax credit - AOL
Biden proposes climate stipulations for hydrogen tax credit
The Treasury Department on Tuesday proposed guidance that officials said would ensure the nascent hydrogen industry develops sustainably — rather than becoming a significant contributor to global warming.
But many industry players say the rules could hamper growth.
Hydrogen could be a key tool to transition industries whose emissions are hard to eliminate to clean power sources.
The tax credits are key for making hydrogen from low- or no-emitting sources economically viable.
In order to qualify, hydrogen power made from renewable energy will have to:
Get its power from new energy sources, instead of electricity that’s already on the grid Have that new energy source located in the same geographic region as the hydrogen production Starting in 2028, have that power be produced in the same hours as the hydrogen production
Officials said they included these guidelines because hydrogen production uses a significant amount of electricity, and they don’t want to pull existing energy from the grid that would increase demand for power overall.
Increased demand for power in general could mean more fossil fuels, they noted.
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Opinions in The Hill
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Related Knowledge Center: Climate legislation
The federal government and states are in the process of implementing two laws — the Infrastructure Investment and Jobs Act and the Inflation Reduction Act — an investment of more than a trillion dollars to address climate change.