Marsh: Tax credit could do industry harm
Plug Power CEO warns proposed clean hydrogen incentive may be hard to claim
COLONIE — The CEO of hydrogen fuel cell manufacturer Plug Power says that the Biden administration may be making a mistake with its proposed clean hydrogen tax credit.
The U.S. Treasury Department is expected to release the so-called 45V tax credit that would provide up to a $3 subsidy per kilogram of clean hydrogen produced through electrolyzers, which turn water into hydrogen. The new rules are expected to be officially released by the end of the year.
Currently, most hydrogen is made directly from natural gas, but Plug Power — which is based in Latham — has built its business strategy on producing clean hydrogen using this electrolysis method. The company has been building industrial-scale electrolyzer facilities across the U.S. and also internationally.
The tax credit for clean hydrogen production would essentially put clean, also known as green hydrogen, on par with hydrogen produced from fossil fuels. The tax credit was authorized under the bipartisan Inflation Reduction Act of 2022, which included many climate change provisions to encourage the use of more carbon-neutral technologies and fuels.
Earlier this month, several news outlets reported leaked details of the clean hydrogen tax credit rules. Among them is a requirement that to be eligible for the tax credit, a production facility must be directly tied to new clean power sources such as wind or solar farms that have been built within the past three years, along with other stringent rules that would likely sideline potential projects.
Hydrogen advocates have said if the rules are too strict, they may do more harm than good getting the clean hydrogen industry off the ground.
Plug Power CEO Andy Marsh released a statement to the Times Union this week that showed how concerned Plug Power is about the proposed rules.
“As one of the first companies
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