Implications of 45V Guidance for the Future of the Green Hydrogen Industry

A study conducted by Wood Mackenzie and commissioned by ACP shows the Administration’s guidelines requiring hourly matching starting in 2028 will limit the ability of the green hydrogen industry to get off the ground.

Green hydrogen, produced using renewable electricity, is critical to decarbonizing the U.S. economy. The Department of Energy estimates low-carbon hydrogen can eliminate 10 percent of economy-wide emissions by 2050. While Treasury’s 45V tax credits are intended to catalyze the still-nascent low-carbon hydrogen industry in the U.S., this study finds the Administration’s proposed guidelines will stifle green hydrogen deployment by making it too expensive.

Wood Mackenzie’s analysis finds that ACP’s framework – reflected in our comments to Treasury –  leads to significantly more green hydrogen deployment by 2032 and puts the industry closer to the pathway required to achieve a net-zero emissions economy. Wood Mackenzie also concluded that the annual matching regime for first movers in ACP’s proposal would not lead to additional emissions. In fact, the Treasury proposal is expected to result in higher hydrogen emissions impacts due to the greater adoption of blue hydrogen that results from the lack of green hydrogen deployment.

Read more in the press release, or download the report.