The Chief Executive Officer of the American Council on Renewable Energy (ACP), Jason Grumet, has issued a statement in response to the U.S. Treasury Department’s guidance on clean energy investment and production tax credits for green hydrogen projects. The Biden Administration’s proposal aims to foster the growth of the green hydrogen industry but is criticized by ACP for a perceived flaw that hinders the commercial scaling of domestic green hydrogen production.
Key Points:
- ACP’s Perspective: The ACP acknowledges the Biden Administration’s three-pillar approach to support the green hydrogen industry but raises concerns about the proposed timeline and restrictions, describing a “fatal – but fixable – flaw” in the current proposal.
- Flaw in the Proposal: ACP points out that the proposal’s imposition of an early hourly matching provision for first-wave green hydrogen projects may discourage clean power companies from investing in green hydrogen manufacturing and facilities. The statement emphasizes that flexibility in time-matching requirements is crucial for successful deployment.
- Proposed Timeline’s Impact: ACP’s analysis suggests that additional flexibility in time-matching requirements could enable the investment in 20 to 40 commercial-scale green hydrogen facilities by 2032. However, the proposed rule’s current form jeopardizes the economic feasibility of these early projects, hindering the industry’s future viability.
- Environmental and Economic Concerns: The statement highlights the perceived greater environmental risk of sidelining green hydrogen for the next 30 years due to proposed restrictions, emphasizing the need for a balanced approach that aligns with net-zero ambitions, energy security, and economic goals.
- Call for Revision: ACP urges the Biden Administration to revise the proposed rule, expressing optimism that necessary changes can be made to avoid inhibiting clean energy deployment and threatening long-term environmental and economic objectives.
The ACP’s response underscores the importance of addressing concerns in the U.S. Treasury Department’s proposed rule on clean energy investment and production tax credits for green hydrogen projects. The call for additional flexibility in the timeline reflects the need for a balanced and pragmatic approach to foster the growth of the green hydrogen industry while aligning with broader environmental and economic goals. The outcome of potential revisions will likely impact the trajectory of green hydrogen initiatives in the United States.
