Understanding the 45V Clean Hydrogen Production Tax Credit: Requirements, Exceptions, and Project Impacts

The U.S. Treasury Department released final guidance on the 45V Clean Hydrogen Production Tax Credit in January 2025. While the guidance did contain the vital “three pillars” of incrementality, temporal matching, and deliverability, which are essential for ensuring hydrogen production does not lead to a massive increase in grid emissions, it also contains several concessions to industry lobbying that have the potential to jeopardize emissions reductions.

Clean Energy Group has produced a 3-page primer on 45V explaining how the 45V tax credit is calculated; how lifecycle greenhouse gas emissions are determined; how emissions are assessed for the electricity used to produce hydrogen; emissions accounting for fossil fuel alternatives; and how 45V will impact hydrogen production projects.

See also: Emissions Accounting for the Hydrogen Production Tax Credit: Key Gaps in the 45VH2 GREET Model