Back
Welcome back to Energy News Weekly! Today, we’ve got an update on a long-awaited federal move that will drive the clean hydrogen industry, and a dive into what it’ll mean under the next president.
After more than a year of anticipation, the U.S. Treasury Department last week released rules for claiming federal clean hydrogen tax credits.
Hydrogen’s role in the clean energy transition is still unclear. The fuel does not release greenhouse gas emissions when burned, so it could help decarbonize heavy manufacturing and large vehicles. But today, it’s largely produced using natural gas, which means it still has a big climate impact. It’s also expensive and hard to come by.
That’s something the Inflation Reduction Act aimed to change. The huge 2022 climate law included the 45V tax credit to push developers to start producing clean hydrogen, but didn’t specify how the fuel had to be made.
As environmental advocates had hoped, the Treasury’s rule will prioritize tax credits for hydrogen made with solar and wind power. But it’ll also grant smaller benefits to hydrogen produced from fossil fuels, so long as it incorporates carbon capture — a method some advocates say could outweigh hydrogen’s climate benefits.
Even with the priority for hydrogen produced with renewables, oil industry leaders and Republican lawmakers still back the hydrogen tax credits, the Washington Post reports. So with that support in place, industry observers expect President-elect Trump to keep the incentives, albeit with a few changes to benefit fossil fuels even more.
🕚 Last-minute drilling ban: President Biden permanently bans the sale of new federal drilling leases off much of the U.S. coasts in a move that will be hard to repeal, but experts say the order is unlikely to slow oil and gas production. (E&E News, Associated Press)
🏭 A manufacturing transformation: U.S. clean energy manufacturing rapidly expanded over the past four years as factories emerged to produce solar panels, batteries and electric cars, though the growth trajectory is less certain going forward under President-elect Trump. (Canary Media)
🏙️ Urban decarbonization: Major U.S. cities are leading the way on decarbonizing large buildings by instituting standards that require owners to submit energy usage data and gradually improve their performance. (Canary Media)
🛢️ Oil’s playbook: An investigation reveals oil and gas companies’ “playbook” for shirking liability for environmental damage, avoiding cleaning up their wells and offloading reclamation costs to taxpayers. (ProPublica)
🚘 EVs roll through winter: The inclusion of heat pumps in newer electric vehicle models is among the improvements helping to boost battery performance during cold weather, as experts say winter charging concerns have been overblown. (Inside Climate News)
⚡️ Gridlocked: A lack of transmission lines on the U.S. power grid and stalled interconnection processes remain the biggest barriers to continued clean energy growth, experts say. (Canary Media)
💰 Cost/benefit: The Inflation Reduction Act’s tax credits will cost around $656 billion but deliver as much as $2.7 trillion in net benefits over the next decade, a report commissioned by a clean power group finds. (Utility Dive)
.svg)
