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US H2 hopes at risk with 45V uncertainty: Industry

  • : Hydrogen
  • 24/12/06

US hydrogen industry developers need more clarity on federal production tax credits (PTC) before moving forward with projects but are hopeful they can convince the incoming administration of the benefits they represent.

A raft of hydrogen projects were announced in the US after President Joe Biden announced billions of dollars in federal funding and tax credits for hydrogen within the 2022 Inflation Reduction Act. But much of that euphoria fizzled after the US Treasury last December proposed rules mimicking European standards that some in the industry argue are too stringent and would make many projects, especially those using natural gas, uneconomical.

"Everyone looked at the US as a very promising market but the reality is that as time goes by uncertainty is growing," said Ana Quelhas, managing director of hydrogen at EDP, on a panel this week at the Reuters EnergyLive conference in Houston, Texas. "There's a big question mark related to the implementation of 45V and that's very bad for investors."

The US still has the opportunity to be a leader in hydrogen if it can implement rules around how the 45V credit is applied correctly, said Tomeka McLeod, vice president of hydrogen at BP.

If so-called blue projects — which make hydrogen from natural gas — can get the full $3/kg credit, "... it would make our projects some of the most competitive globally," McLeod said.

Rules related to the use of renewable and certified natural gas in hydrogen production still need to be "hammered out," she said.

BP aims to have 5-10 projects online by the end of decade but McLeod says they will be evaluated by the same internal standards of any other project. "We need to make sure that the economics of those projects work, they need to be able to compete within our portfolio," she said.

BP is part of the Midwest Alliance for Clean Hydrogen (MachH2) that recently received $1bn in Department of Energy (DOE) funding and plans to produce hydrogen from natural gas with carbon capture to power its Whiting refinery in Indiana.

Christmas gift or lump of coal

Many of those gathered at the conference in Houston this week said they hoped further guidance would arrive "like a Christmas present" in the waning weeks of the year, and the Biden administration would sew up any lingering details before leaving office.

Nonetheless, they still expect to be subjected to further scrutiny under the Trump administration, which has made clear its disdain for clean-energy mandates.

Learning to speak to the concerns of the new administration will be crucial to success, industry leaders said, including explaining hydrogen's role in promoting national security and job creation.

"We need to educate this incoming administration and collaborate and make sure that the momentum that is already here continues, and [show] that we can actually do the right thing from a national energy security perspective," said Sanjay Shrestha, president of Plug Power, a company that develops hydrogen fuel cells to replace conventional batteries.

Keystate Energy chief executive Perry Babb, whose company is looking to produce clean hydrogen in Pennsylvania, said aligning with the administration's goals as well as a solid business case will be key to survival.

"We will need to speak the language of the administration," Babb said.


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25/01/30

Proven tech focus of 2024 transition investment: BNEF

Proven tech focus of 2024 transition investment: BNEF

London, 30 January (Argus) — Global energy transition investment rose to record levels in 2024, Bloomberg New Energy Finance (BNEF) says in a report published today, but growth was centred on proven technologies and the amount put into emerging sectors declined. Overall investment in the energy transition reached almost $2.1 trillion last year, BNEF says, an increase of 11pc from 2023 and the highest ever. But the increase was markedly smaller than the 24-29pc annual growth recorded over the previous three years. And investment needs to rise to $5.6 trillion/yr in 2025-30, and $7.6 trillion/yr in 2031-35, to align with achieving net zero emissions by mid-century, BNEF says. About 93pc of energy transition investment last year related to "proven, commercially scalable" technologies, BNEF says, resisting pressure from higher interest rates and policy decisions to rise by 14.7pc to $1.93 trillion. Of these, electrified transport attracted the most investment at $757bn, up by 20pc on the year, followed by renewable energy, up by 8pc to $728bn, and power grids, up by 15pc to $390bn. But investment in emerging technologies fell by 23pc on the year to $154bn. Carbon capture and storage investment halved to $6.1bn, as did clean industry investment to $27.8bn. And hydrogen investment declined by 42pc to $8.4bn. BNEF points to issues surrounding technology maturity, scalability and affordability as key hindrances in emerging sectors, flagging the need for public-private partnerships to derisk investment and encourage growth. The main regional sources of investment shifted in 2024, as mainland China increased its contribution by 20pc to $818bn, investing more than the principal 2023 growth drivers — the EU, US and UK — combined. EU investment fell to $381bn and the UK's to $65.3bn, while the US' held stable at $338bn. By Victoria Hatherick Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Spain to give €400mn to EU Hydrogen Bank auction losers


25/01/30
25/01/30

Spain to give €400mn to EU Hydrogen Bank auction losers

Madrid, 30 January (Argus) — Spain plans to distribute €400mn ($417mn) among renewable hydrogen projects that met the criteria to compete in the EU's pilot Hydrogen Bank auction in 2024 but whose bids were too high to be selected for subsidies. The funding will add to €1.32bn to be allocated "in the next few weeks" to large-scale hydrogen clusters as part of Spain's Perte Hydrogen Valley scheme, according to prime minister Pedro Sanchez. Spain submitted 46 projects with a combined 2.9GW of electrolysis capacity to the Hydrogen Bank auctions in April 2024. Three of the seven projects selected from the 119 eligible bids lodged by EU countries were Spanish, although developer Benbros Energy eventually decided not to claim its operating subsidies of €0.38/kg of renewable hydrogen produced. The support announced by Sanchez for eligible projects that missed out on the operating subsidies was at the top end of the €280mn-400mn range proposed by Spain after the auction. The €1.32bn for hydrogen valley Perte is higher than the €1.2bn originally announced. Sanchez defended Spain's focus on renewables and low-carbon energy vectors such as green hydrogen, which he cited as a driver for the country's 3.5pc year-on-year fourth quarter GDP growth, as reported this week by national statistics institute INE. "We are going to continue on this path, we are going to reinforce our policy of 'green, baby, green'," Sanchez said, an allusion to US President Donald Trump's "drill, baby, drill" promise to unleash the full potential of the US oil and gas industry. By Jonathan Gleave Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

ECA's green export finance bypasses developing nations


25/01/29
25/01/29

ECA's green export finance bypasses developing nations

Berlin, 29 January (Argus) — The "greening" of export credit agency's (ECA) finance which occurred in the past decade has largely bypassed developing countries, with investments mainly flowing to higher-income countries, according to a study on ECA transactions. The study, carried out by researchers from the business schools HEC Lausanne, ETH Zurich and HEC Paris, shows that ECA energy finance going to lower-income countries dropped to below 30pc in 2022-23 from 47pc in 2013-15. ECAs, including export-import banks, are state-backed agencies that help national exporters finance deals abroad by providing guarantees or loans. The share of ECA renewables commitments — mostly offshore wind and, increasingly, green hydrogen — rose to around 40pc in 2022–23, from under 10pc in 2013. The complete phase-out of fossil fuel financing appears "distant", the researchers noted. While ECAs handle financing volumes "on a par with multilateral development banks such as the World Bank", the scope and direction of their energy investments have largely remained "opaque", the researchers said. The study is based on an analysis of almost 1,000 transactions between 2013-23 which financed energy-related infrastructure and were supported by ECAs. For some key ECA countries such as China or Canada, data is only partially available. The study also reveals "notable" disparities between countries. Most members of the Export Finance for Future coalition (E3F), a group of European countries committed to aligning their export finance with the Paris climate agreement, have introduced stricter fossil fuel exclusions and are boosting their renewable portfolios. At the same time, major players like South Korea, Japan, and China have maintained significant levels of oil and gas lending. OECD countries should introduce "more rigorous climate policies" and renew international cooperation, the researchers said, particularly with non-OECD countries such as China. The OECD — where ECA terms and conditions are negotiated — could relaunch the International Working Group on ECAs, they said, to help ensure that countries phasing out support for fossil fuels do not see their market shares grabbed by others. Better renewable investment support via ECAs could help scale up the new collective quantified goal (NCQG) on climate finance, set at a minimum of $300bn annually by 2035 at the last UN Cop 29 climate summit in November, the researchers said. And ECA mandates could also be broadened to accommodate the needs of lower-income regions. "It is high time for ECAs to complete the shift to renewable energy, and through carefully designed policies and international cooperation, become true catalysts for a rapid and just energy transition," lead author Philipp Censkowsky from HEC Lausanne said. By Chloe Jardine Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Norwegian 20MW green H2 project reaches FID


25/01/28
25/01/28

Norwegian 20MW green H2 project reaches FID

Mumbai, 28 January (Argus) — Norwegian project developer GreenH and German asset manager Luxcara have taken a final investment decision (FID) on a 20MW renewable hydrogen project in Norway's Bodo municipality. The plant is slated to produce up to 3,100 t/yr of renewable hydrogen from 2026. The supply will be delivered to ferry operator Torghatten Nord, making the plant the first to deliver pressurised renewable hydrogen directly to a maritime vessel, according to GreenH. GreenH2 and Torghatten Nord in August 2023 struck an agreement for renewable hydrogen supply in 2025-40. Torghatten Nord will use the hydrogen on two ferries which are scheduled to start operations in October 2025. The company also plans to sell oxygen and waste heat from the facility to generate additional revenue. GreenH secured a 1bn Norwegian kroner ($89mn) financing package for the plant "through private placements, loan schemes and a share purchase" over the past few years. The funding includes NOK129mn from Norwegian government body Enova which was confirmed last month. This is part of a larger NOK391mn award from the body for three projects planned by GreenH. Luxcara is also involved in the 100MW Hamburg Green Hydrogen Hub in Germany which is due to start construction this year with a view to starting production in 2027. By Stefan Krumpelmann Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Plug Power sells $30mn ITC from Georgia H2 plant


25/01/27
25/01/27

Plug Power sells $30mn ITC from Georgia H2 plant

Houston, 27 January (Argus) — Hydrogen producer and equipment manufacturer Plug Power has boosted its liquidity through the transfer of a federal investment tax credit (ITC) to an unspecified investor, tapping a financing mechanism more commonly used by solar and wind projects. This is the first time that Plug Power has taken advantage of transferability rules laid out under the Inflation Reduction Act (IRA) of 2022 and it is among the first such deals for hydrogen storage and liquefaction assets, Plug said Monday. The deal comes just days after President Donald Trump ordered a pause to IRA-related funding that has left many in the sector wondering about the fate of hydrogen-related disbursements. In an ITC transfer, a renewable-energy developer can sell a tax credit and receive a one-time, up-front payment. As of last April, when the US Treasury Department finalized ITC rules intended to accelerate the construction of clean energy projects, "the bulk" of transferability-related registrations were related to solar and wind projects, Treasury said. Plug qualified for the ITC through its investment in liquefaction and storage technologies at its Woodbine, Georgia, hydrogen plant, which began production early last year. The 15 metric tonne/d plant can also claim production tax credits under section 45V for green hydrogen production, Plug said. By Jasmina Kelemen Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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