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Rep. Don Beyer, Rep. Jamie Raskin and 44 Colleagues Advocate (including Rep. Bobby Scott, Rep. Jennifer McClellan) for Strong Climate Standards in New Clean Hydrogen Tax Credit Implementation

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Good stuff from Rep. Don Beyer (D-VA08), Rep. Jamie Raskin (D-MD08) and a bunch of their colleagues, including Rep. Bobby Scott (D-VA03), Rep. Jennifer McClellan (D-VA04)…

RASKIN, BEYER ADVOCATE FOR STRONG CLIMATE STANDARDS IN NEW CLEAN HYDROGEN TAX CREDIT IMPLEMENTATION

December 8, 2023

WASHINGTON, DC– Representatives Jamie Raskin (MD-08) and Don Beyer (VA-08) and 44 colleagues wrote the U.S. Treasury Secretary Janet Yellen and Climate Counselor Ethan Zindler urging the Treasury Department to adopt strong climate standards when implementing the Inflation Reduction Act’s Clean Hydrogen Production Tax Credit.

The Clean Hydrogen Production Tax Credit incentivizes and rewards new clean hydrogen projects, which will encourage the adoption of greenhouse gas emission-free energy. Environmental groups, consumer advocates, and forward-thinking hydrogen companies alike have stressed the importance of ensuring hydrogen fuel is produced from clean energy sources, rather than unabated fossil fuels, coal plants or other dirtier energy sources.

“The IRA’s incentives for clean hydrogen and other emerging technologies offer great promise in reducing emissions in difficult-to-decarbonize sectors,” wrote the lawmakers. “As the administration finalizes rules for the IRA’s 45V Clean Hydrogen Production Tax Credit, we strongly urge you to ensure that the guidance results in a net decrease in greenhouse gas emissions.”

The lawmakers continued, “As policymakers, we must be attentive to the negative consequences of weak 45V rules for hydrogen production, which would imperil our climate goals and lead to significant U.S. emissions increases, including from Regional Clean Hydrogen Hubs recently announced by the Department of Energy. Hydrogen production is extremely energy intensive, and absent strong rules, clean hydrogen production could result in emissions that are equivalent to running 26 more coal plants, taking us in precisely the wrong direction in our transition to clean, renewable energy. Strong rules will allow the U.S. to harness hydrogen’s most promising climate, health, and economic benefits, setting up our domestic clean hydrogen industry for long-term success.”

Specifically, Representatives Raskin and Beyer express support for:

  • The three pillars of sustainable hydrogen production endorsed by climate groups,  consumer advocatesenvironmental justice organizationsrenewable energy companies, state legislators, and forward-thinking hydrogen companies, which include:
    • Additionality: Hydrogen should be generated using new, “additional,” renewable energy sources, not just the limited renewables currently supplying our power grid. Without this requirement, the energy-intensive hydrogen production will significantly increase energy usage and redirect the limited clean electricity towards hydrogen production, leaving polluting sources such as coal and natural gas to meet energy demand.
    • Deliverability: Power generated by clean energy must be able to reach hydrogen production projects. Without deliverability requirements, clean energy produced in one region will not reach the hydrogen production plant, forcing local and dirtier generators to fill the gap and increase overall emissions.
    • Hourly time-based matching: Hydrogen should be produced during the same hours that the clean electricity is being generated. This ensures that hydrogen production does not increase the use of energy from dirtier sources available at other times of day. Absent this requirement, hydrogen project operators may use up the limited low-cost clean energy resources for hydrogen production, forcing families to pay for higher-cost energy from fossil fuels.
  • Preventing heavily polluting fossil fuel-based hydrogen projects from engaging in greenwashing and claiming the 45V credit.
  • Ensuring that hydrogen projects accurately account for their total greenhouse gas emissions across their full lifecycles and do not cause spikes in electricity grid emissions and prices (as, for example, cryptocurrency mining has done).

“Strong rules are crucial to ensuring a successful hydrogen sector that catalyzes cutting-edge electrolyzer technologies and enables the creation of truly clean global hydrogen markets, in line with international partners. In the EU, some industry groups fought hard against the 3-pillars, but after their announcement quickly changed focus to implementation. Even in the few months since the announcements, we have seen hundreds of millions of dollars of investments made into 3-pillar compliant projects in Europe and steady growth in announced projects,” said Killian Daly, an industry expert at EnergyTag.

“Implementing the three pillars would send a clear message to the clean hydrogen industry that incentives will scale with performance. Many companies are eager to innovate, deploy investment in U.S. manufacturing and production, and ensure this public investment in decarbonization is a bridge to somewhere,” said Mike Sloan, CEO of Synergetic.

“We urge Treasury to protect families from potential energy price spikes by implementing the three pillars of 1) additionality, 2) deliverability, and 3) hourly matching for electrolytic hydrogen producers seeking the 45V credit,” said Tyson Slocum, Energy Program Director at Public Citizen.

Supporting organizations include the Natural Resources Defense Council, League of Conservation Voters, Sierra Club, Public Citizen, Evergreen Action, Environmental Defense Fund, Union of Concerned Scientists, Earthjustice, National Consumer Law Center, Chesapeake Climate Action Network AF, Climate Action Campaign, Western Environmental Law Center, Appalachian Voices and the Citizens Action Coalition, Electric Hydrogen, EnergyTag and Synergetic.

Signers include Representatives Alma Adams, Nanette Barragán, Earl Blumenauer, Suzanne Bonamici, Julia Brownley, Greg Casar, Yvette Clarke, Emanuel Cleaver, Steve Cohen, Mark DeSaulnier, Adriano Espaillat, Robert Garcia, Raúl Grijalva, Jared Huffman, Henry Johnson, Ro Khanna, Barbara Lee, Ted Lieu, Doris Matsui, Jennifer McClellan, Betty McCollum, Morgan McGarvey, James McGovern, Eleanor Norton, Alexandria Ocasio-Cortez, Ilhan Omar, Brittany Pettersen, Katie Porter, Ayanna Pressley, Delia Ramirez, Deborah Ross, Janice Schakowsky, Adam Schiff, Robert Scott, Melanie Stansbury, Mark Takano, Shri Thanedar, Dina Titus, Rashida Tlaib, Jill Tokuda, David Trone, Bonnie Watson Coleman, Nikema Williams and Frederica Wilson.

The letter can be found in full here.

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