Calibrating US Tax Credits for Grid-Connected Hydrogen Production: A Recommendation, a Flexibility, and a Red Line

RMI provides recommendations for the US Department of the Treasury regarding the 45V production tax credit (PTC) for grid-connected green hydrogen, arguing for a balance between industry acceleration and strict emissions standards to ensure climate goals are met.

• The Inflation Reduction Act (IRA) created the 45V production tax credit (PTC) to serve as a financial catalyst for clean hydrogen projects, with the highest benefits reserved for projects producing the lowest emissions hydrogen.
• Green hydrogen projects using electrolyzers must utilize between 90% and 97.5% zero-carbon power to qualify for the maximum tax credit; however, grid-connected projects currently face challenges because the US grid is primarily powered by fossil fuel-intensive generators.
• RMI recommends that the US Department of the Treasury implement flexible PTC rules for early adopters to reduce complexity and costs, but proposes that these flexible rules phase out by January 1, 2028, in favor of emissions-accurate, forward-looking standards.

APA

RMI (2023). Calibrating US Tax Credits for Grid-Connected Hydrogen Production: A Recommendation, a Flexibility, and a Red Line. https://rmi.org/resources/calibrating-us-tax-credits-for-grid-connected-hydrogen-production/

Chicago

RMI. Calibrating US Tax Credits for Grid-Connected Hydrogen Production: A Recommendation, a Flexibility, and a Red Line. 2023. https://rmi.org/resources/calibrating-us-tax-credits-for-grid-connected-hydrogen-production/.

Wikipedia

{{cite press release |author=RMI |title=Calibrating US Tax Credits for Grid-Connected Hydrogen Production: A Recommendation, a Flexibility, and a Red Line |date=26 July 2023 |url=https://rmi.org/resources/calibrating-us-tax-credits-for-grid-connected-hydrogen-production/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@misc{rmi2023calibrating, author = {{RMI}}, title = {{Calibrating US Tax Credits for Grid-Connected Hydrogen Production: A Recommendation, a Flexibility, and a Red Line}}, publisher = {RMI}, year = {2023}, month = jul, url = {https://rmi.org/resources/calibrating-us-tax-credits-for-grid-connected-hydrogen-production/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }