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Gary Tansley's picture
Project Finance & Funding Specialist BGSE

Construction & Project Funding Worldwide. Renewable Energy / Green Tech / Biomass & much more. BGSE works with a boutique panel of niche, specialist lenders. BGSE DO NOT CHARGE FOR OUR...

  • Member since 2022
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  • Aug 2, 2022

Hopefully this can be a breakthrough in the USA and they can lead the rest of the world.

The surprise breakthrough tax and climate bill agreed yesterday by maverick coal-state Democratic senator Joe Manchin and Senate majority leader Chuck Schumer includes generous tax credits that would make green hydrogen cheaper to produce than grey in many parts of the US — at today’s prices, at least.

Hydrogen: hype, hope and the hard truths around its role in the energy transition

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The full text of the $433bn Inflation Reduction Act of 2022revealed today — shows that a tax credit for “qualified clean hydrogen” would pay producers up to $3 per kilogram (adjusted for inflation) — depending on the levels of lifecycle emissions and staff wages.

'Enormous sigh of relief' for US clean energy as maverick senator backs climate deal

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According to the latest figures from analyst S&P Global Platts, polluting grey H2 (made from unabated natural gas) costs $1.71-2.18/kg to produce, depending on where in the US it is made — all of which is cheaper than hydrogen produced elsewhere in the world, due to sky-high natural gas prices outside the US. Platts puts the cost of producing green hydrogen from renewable energy and electrolysis in a range between $3.73/kg in the US Northwest and $6.50/kg in the Southeast.

Matt Chester's picture
Matt Chester on Aug 2, 2022

I wonder if green hydrogen could end up getting cross-aisle support and enthusiasm in the end, but it's interesting that you pointing this out is among the first I've read about this development from the bill. It's certainly flying under the radar. Is that by design? Because wider audiences don't fully understand hydrogen? 

Gary Tansley's picture
Thank Gary for the Post!
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