Treasury Proposes Tax Credit Regulations to Boost Clean Hydrogen Production in Biden’s Climate Policy Framework.

The US Department of the Treasury has proposed regulations regarding a tax credit for the production of “clean hydrogen,” a significant supply-side incentive part of the Biden administration’s climate-driven policy framework. The proposed regulations would amend Sections 45V and 48(a)(15) of the Internal Revenue Code, which would establish a tiered production tax credit (PTC) available for each kilogram of clean hydrogen produced during a taxable year for the first 10 years after a hydrogen production facility begins operation. The highest-value tier of the PTC requires lifecycle GHG emissions below 0.45 kg CO2e per kg of hydrogen. The Department of Energy also issued a white paper outlining the lifecycle emissions impacts of electricity used for hydrogen production.