Six House Democrats from California are criticizing the Treasury Department’s proposed tax rules for “clean” hydrogen, saying the Biden administration must better accommodate states that already have zero-emissions electricity standards in place.
In a letter obtained by POLITICO’s E&E News, Reps. Salud Carbajal, Jim Costa, Anna Eshoo, Josh Harder, Jared Huffman and Ro Khanna, all of California, said requirements in Treasury’s draft guidance to receive 45V tax credits under the Inflation Reduction Act are “particularly detrimental to our state.”
“We fully endorse the objectives of incentivizing renewable electricity generation, but the current mandate does not account for the considerable efforts that states like California are making toward reducing grid emissions,” said the letter addressed to Treasury Secretary Janet Yellen, a rare, coordinated pushback against 45V from progressive Democrats.
The lawmakers targeted a requirement in Treasury’s guidance known as “incrementality,” which dictates that hydrogen producers must add new, clean energy generation to the grid less than three years prior to using electrolyzers to split water to create hydrogen.
