US tax credits for green hydrogen 2022-08-11 17:40 ET
Jericho Energy Ventures Inc. has applauded the U.S. government's landmark $369-billion (U.S.) Climate and Clean Energy Bill.
A centrepiece of the bill is the clean hydrogen production tax credit (PTC), which provides up to $3 per kilogram in tax credits for clean produced hydrogen, known as green hydrogen. The tax credits are estimated to reduce the current cost to produce clean hydrogen by more than 50 per cent and should make clean hydrogen produced in the United States the cheapest form of hydrogen in the world.
Ryan Breen, head of corporate strategy at Jericho, said: "The PTC is the most consequential piece of legislation for the adoption of clean hydrogen and represents a historic investment in the U.S. clean energy industry. The maximum $3-per-kilogram PTC will immediately put clean hydrogen into cost parity with carbon-emitting fuels like coal and natural gas, and will remove a critical barrier to its adoption by industry. Much like the solar tax credits of the mid-2000s, we expect to see tremendous growth for the utilization of clean hydrogen across the U.S. economy, and Jericho is excited to be a part of the journey at the ground level."
Brian Williamson, chief executive officer at Jericho, said: "Eliminating the green premium associated with clean hydrogen through the PTC is an enormous win for our DCC hydrogen boiler customers, as well as our critical investments in clean hydrogen production technologies like those in H2U and Supercritical Solutions. Reducing the cost of clean hydrogen is the elephant in the room with respect to commercial and industrial adoption, and we excited to see that barrier largely eliminated."
A new study by research firm Transparency Market Research projects that the global green hydrogen market will expand from $2.14-billion (U.S.) in 2021 to $135.73-billion (U.S.) by 2031, a compound annual growth rate of 51.6 per cent. This represents a 10-year industry growth of over 6,000 per cent.