The tax credits under the Inflation Reduction Act could have deep implications for the fuel’s contributions to the grid and emission reductions ( Energywire, Dec. ![]() The Treasury Department is examining a range of possible restrictions on “clean” hydrogen producers, as it develops guidance for companies seeking to claim the industry’s first-ever tax credits. “It seems to me that this is a national issue.” “Then the other states would be in the same situation,” he said. If Massachusetts imports hydrogen, he said, then it would also be importing another state’s “cannibalization” of clean power. Roetter of Gas Transition Allies said the group’s concerns apply whether the hydrogen is made in Massachusetts or in another state. National Grid has said a possible source for Massachusetts hydrogen is the Northeast Clean Hydrogen Hub, a seven-state coalition seeking to tap billions in federal funds for low-carbon hydrogen production and consumption ( Energywire, Aug. Companies in Texas or elsewhere might commission new wind or solar facilities solely for use in hydrogen production, rather than tapping existing renewable capacity. “You could probably make a lot of hydrogen much cheaper in Texas than in New England, for example.” ![]() “It’s not clear that you’d have to produce the green hydrogen locally,” Weiss said. In an interview, Weiss took issue with one assumption in the report from Gas Transition Allies: that the Massachusetts gas utilities would use hydrogen that is made in-state, from electricity generated by offshore wind turbines and other renewables. “Hydrogen will be part of our future energy system,” Weiss said. The bipartisan infrastructure law and Inflation Reduction Act created billions of dollars in direct grants and tax credits to support low-carbon hydrogen production, including for green and “blue” hydrogen, which envisions combining production of the fuel from gas with carbon capture and storage. “We know many customers will continue to rely on our existing network for years to come and that we must decarbonize it to reach net zero and ensure we don’t leave emissions reductions on the table,” she wrote in an email.Īccording to Jürgen Weiss, a former Brattle Group consultant and founder of clean energy research firm Dash2Zero, determining the future of natural gas systems is “one of the more complicated and controversial questions” for energy policymakers.īut new federal subsidies will ensure hydrogen remains part of the discussion as a gas substitute, he added. Hydrogen is going to grow “much more affordable and more abundant in coming decades,” providing a clean energy option for residents unable to switch from gas to electric heat pumps, said Christine Milligan, a spokesperson for the utility National Grid. The state’s utilities argue that hydrogen should be kept on the table as Massachusetts works to reach net-zero emissions by 2050. “By not being able to decarbonize the grid, you would in fact completely sabotage climate action plans,” said Martyn Roetter, a technology consultant who is a member of Gas Transition Allies and one of the report’s co-authors. In Massachusetts, the process could conceivably be driven by offshore wind turbines, although the Gas Transition Allies argue that the turbines’ power would be more efficiently used directly for power generation. Green, or renewable, hydrogen is expected by analysts to become the central way of producing a low-carbon version of the fuel in the coming years.
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