Summary

On December 22, 2023, the United States Treasury and the Internal Revenue Service (IRS) provided a long-awaited definition for “clean hydrogen” in the proposed regulations interpreting the clean hydrogen production tax credit under Section 45V of the Internal Revenue Code of 1986. The definition of clean hydrogen under the Section 45V proposed regulations has drawn an unprecedented amount of attention and lobbying on all sides of the debate. The stakes are high because the “clean hydrogen” label is the key to securing a broad array of federal government benefits and subsidies, including the Section 45V tax credit. This article provides an overview of the clean hydrogen production credit, summarizes the key elements of the Section 45V proposed regulations, and discusses their implications for the development and operation of hydrogen projects in the United States.

This paper will be part of the OGEL Special Issue on "International Energy and Investment Law Implications of the US Inflation Reduction Act". More information here www.ogel.org/news.asp?key=762