45V Green Hydrogen Tax Credit Evaporates Overnight
The US House of Representatives has narrowly approved a contentious tax and spending bill that eliminates the 45V green hydrogen production tax credit.
Analysts warn that this move could jeopardize nearly all planned green hydrogen capacity in the country.
Dubbed the “One Big Beautiful Bill,” the legislation passed by a single vote—215 to 214—after a marathon overnight session that concluded with a final decision at 7 AM local time.
Focused on tax and spending cuts, the bill includes a provision to terminate Section 45V, a key credit from the Biden-era Inflation Reduction Act, which had been instrumental in jumpstarting the US hydrogen sector.
Anything Built after 2025 Will be Prohibited From Tax Credit
If enacted, the bill prohibits hydrogen projects starting construction after December 31, 2025, from claiming 45V, undermining its long-term viability.
Currently, projects can access up to $3 per kilogram of hydrogen produced until 2033.
Many within the hydrogen industry had hoped Republican lawmakers in hydrogen-rich districts would oppose the measure.
House Speaker Mike Johnson hailed the bill as “once-in-a-generation” legislation, while Democrats pledged to fight it aggressively.
Next, the bill moves to the Senate, where it must secure a simple majority (51 votes). With Republicans holding 53 seats, passage is likely – unless internal opposition emerges.
If amendments are made, a conference committee will reconcile differences, with the final version returning for another vote in both chambers before heading to President Trump’s desk for approval.
Since its introduction, hydrogen advocates have warned that repealing 45V could have devastating consequences.
The Fuel Cell and Hydrogen Energy Association (FCHEA) has described the measure as a “catastrophic setback.”
An industry letter to Republican House leaders stated, “Our sector has billions in investments ready to deploy nationwide.
However, should Section 45V be prematurely eliminated, phased down, or significantly altered, these investments and jobs will not materialize.”
The UK’s Opportunity to Lead in Hydrogen Innovation
With the US potentially scaling back its hydrogen incentives, the UK has a strategic opening to position itself as a global hydrogen leader.
The British government has already committed over £21 million to support seven hydrogen projects across the country, spanning from Suffolk to Shetland.
These initiatives aim to power buses, trucks, and trains, while also helping businesses transition away from natural gas.
The UK’s geography, geology, and existing infrastructure provide a strong foundation for hydrogen development.
The North Sea’s transferable skills from oil and gas, combined with a stable policy environment, make the UK well-positioned to scale hydrogen production.
