Consumer Cost Impacts of 45V Rules

This briefing argues that weak Treasury guidelines for the 45V hydrogen production tax credit could increase wholesale electricity prices for consumers. It advocates for the strict application of three pillars—additionality, deliverability, and hourly matching—to ensure that new electrolyzer demand is offset by new clean generation, preventing the price spikes associated with large-scale electricity loads like cryptocurrency mining.

• Failure to implement the three pillars of additionality, deliverability, and hourly matching for 45V hydrogen production tax credits may lead to significant increases in power prices. A Princeton University ZERO Lab study suggests prices could rise by 8 percent in California and 10 percent in Colorado, while a TU Berlin study found a 43 percent increase in power prices resulting from weak hydrogen production rules.
• Electrolyzers are high-capacity electricity users that, without requirements for new clean generation (additionality), will force electricity markets to use more expensive generators, thereby raising wholesale prices. The document notes that meeting the Department of Energy's goal of 10 MMT per year of clean hydrogen via electrolysis would use 12% of current electricity usage, a significantly larger load than cryptocurrency assets, which consume between 0.9% and 1.7% of total U.S. electricity usage.
• The document uses cryptocurrency mining as a proxy for the price impacts of large, steady electricity loads. In Texas, wholesale power prices increased by 2 percent for every gigawatt (GW) of extra load from cryptominers. In Upstate New York, increased consumption from cryptominers resulted in additional annual costs of $204 million for households and $92 million for small businesses.
• Loosening the requirements for hourly matching and deliverability can still lead to price increases even if additionality is enforced. If annual matching is permitted, electrolyzers may operate 24/7 while clean generation is concentrated in low-price periods; because the supply curve slope increases with demand, the price increases from steady electrolyzer use may outweigh the price suppression from intermittent clean generation.

APA

Gimon, E. (2023). Consumer Cost Impacts of 45V Rules. Energy Innovation. https://energyinnovation.org/wp-content/uploads/Consumer-Cost-Impacts-of-45V-Rules-2.pdf

Chicago

Gimon, Eric. Consumer Cost Impacts of 45V Rules. Energy Innovation, 2023. https://energyinnovation.org/wp-content/uploads/Consumer-Cost-Impacts-of-45V-Rules-2.pdf.

Wikipedia

{{cite report |last1=Gimon |first1=Eric |title=Consumer Cost Impacts of 45V Rules |publisher=Energy Innovation |date=November 2023 |url=https://energyinnovation.org/wp-content/uploads/Consumer-Cost-Impacts-of-45V-Rules-2.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{gimon2023consumer, author = {Gimon, Eric}, title = {{Consumer Cost Impacts of 45V Rules}}, institution = {Energy Innovation}, year = {2023}, month = nov, url = {https://energyinnovation.org/wp-content/uploads/Consumer-Cost-Impacts-of-45V-Rules-2.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }