Additionality and the Inflation Reduction Act
With the passing of the Inflation Reduction Act (IRA), Congress has made clear its intentions to combat climate change head-on by investing heavily in a broad number of mitigation technologies and strategies. The legislation included several dozen incentives for renewable power development, clean manufacturing, clean buildings, and clean hydrogen, among other things. Specifically, the IRA includes a production tax credit (PTC) providing up to a $3.00/kg-H2 production credit for hydrogen produced with less than 0.45 kg-CO2/kg-H2. As emissions of the hydrogen production increase, the value of the credit correspondingly decreases. Within the statute, Congress’ mandates the emissions be calculated using the Greenhouse Gases, Regulated Emissions, and Energy Use in Transportation (GREET) model or its subsequent updated revisions. As the Treasury Department considers how to implement all of these various tax incentives, a debate has emerged over whether there should be additional regulations or requirements for hydrogen production to be allowed for the PTC. While well meaning, these additional regulations, such as the “Three Pillars”, would only serve to severely restrict the ability of the clean hydrogen economy to scale up and, ultimately, prevent the U.S. from meeting our climate targets.
Take a deep dive into “additionality” with Plug’s Principal R&D Engineer, Luke Wentlent, Ph.D. Learn about what’s included in the landmark Inflation Reduction Act designed to accelerate the buildout of the green hydrogen economy – and, more importantly, what’s not included.
Plug’s Luke Wentlent discusses what’s included in the landmark Inflation Reduction Act designed to accelerate the buildout of the green hydrogen economy
Plug’s Luke Wentlent highlights why the Princeton paper which initially propose the three pillars (including additionality) made some serious oversimplifications of the situation.
Plug’s Luke Wentlent shows how Hydrogen can make an impact right now, and needs to be scaled now. The intent of Congress was not to overly regulate the production of green hydrogen. “We have to jump start this now, or we’re going to miss the window.”