(The Center Square) – During a Wednesday hearing of the Senate Energy Committee, U.S. Sen. Maria Cantwell, D-Wash., aggressively questioned Energy Secretary Chris Wright about Republican efforts to eliminate the clean hydrogen production tax credit.
In 2023, the Biden administration awarded a $1 billion grant to the Pacific Northwest Hydrogen Association, a multi-state, nonprofit coalition focused on developing a regional clean hydrogen hub in the Pacific Northwest. The coalition includes partners from Washington, Oregon and Montana.
Such hubs are envisioned to help speed up the development of hydrogen as a clean fuel that could help reduce greenhouse gas emissions in difficult-to-decarbonize industries, such as fertilizer production, steel making and electricity generation.
The House of Representatives has passed the “One Big Beautiful Bill Act,” which included a provision to eliminate the 45V tax credit for projects that begin construction after 2025. Section 45V of the U.S. Internal Revenue Code provides a tax credit for producing clean hydrogen.
The Republican-led Senate Finance Committee has retained the clause to scrap the 45V credit in their version of the budget reconciliation bill, which mirrors the House’s provision to eliminate the credit for projects starting construction after 2025.
“I actually think getting rid of the tax credits that we have, some of the other ones, broadly, are going to lead to electricity increased cost,” Cantwell said. “And so, can I get you to tell me about the hydrogen hubs, whether you believe you support the hydrogen hubs and moving forward on this?”
“It’s tough with the math to see how, in the long term, it becomes a meaningful commercial energy source,” Wright told Cantwell.
Wright referenced the U.S. Department of Energy’s review of some 500 projects to ensure they are “financially sound and economically viable, aligned with national and economic security interests,” and consistent with the current administration’s policies.
“So, we put together, as I’m sure you’ve heard, and we’ve published it on the website, this project review process,” he said. “We have a cross-functional team that evaluates every project. We’re going through 500 projects.”
Cantwell responded with more questions.
“But is that data call a way to kill the projects?” she asked. “Or no, you really believe in funding some?”
Wright offered up a general response to the senator’s questions.
“Oh, absolutely. No, we are funding plenty of projects right now, and we don’t stop funding any project,” he said. “We’re funding all of the existing projects right now, and when we evaluate them – no, plenty of projects will pass. Plenty of projects will pass. Other projects we’ll say, ‘Hey, can you modify it this way to make it much more beneficial?’ Some projects will be modified, and some projects will be ended.”
The Trump administration has established the National Energy Dominance Council to streamline permitting and regulation, aiming to increase domestic energy production and exports. Hydrogen is included in the definition of “energy resources” that the administration intends to expand.
