USA goes for blue hydrogen12 Jan 2025 08:30
The outcome is clear as day. Remember, no republicans actually voted for the IRA and those that want to keep some elements of it now will be to support blue hydrogen tax incentives, not green. Trump has made is position very clear on green energy with huge public spending cuts are on the way. USA will opt for blue h2 over green. Green H2 projects will struggle to find off-take agreements and if any do, the green hydrogen output will be dwarfed by blue.
In 2025, the U.S. hydrogen market will focus heavily on blue hydrogen, with over 1.5 million tons per annum (Mtpa) of capacity reaching the final investment decision (FID).
This marks a 10X increase compared to green hydrogen. With this output, the U.S. has all the potential to become the world’s leading blue hydrogen producer.
https://www.woodmac.com/blogs/energy-pulse/biden-administration-finalises-45v-hydrogen-tax-credit-rules/
"The revised guidelines for eligibility for the 45V tax credit include some important differences from the initial proposal, published in December 2023. But they do not change the fundamental outlook for low-carbon hydrogen in the US. Prospects for blue hydrogen, made from natural gas with carbon capture, look significantly better than for green hydrogen, made by electrolysing water using carbon-free power.
The economics of low-carbon hydrogen production in the US favour blue over green. The blue hydrogen projects in advanced development and under construction in the US have a total capacity of 3.33 million tons per year (Mtpa). The equivalent total for green hydrogen projects is just 0.35 Mtpa. The revisions to the rules for 45V will not change that position, and if anything will probably be more helpful for blue hydrogen producers than for green."
"It will be open to the Trump administration to replace the guidance published last week with its own set of rules. There will also be a push in Congress to cut or abolish all of the tax credits for low-carbon energy in the IRA. In a press conference this week, President-elect Donald Trump again called out what he described as “the ridiculous spending on the Green New Scam”.
However, there is widespread backing for some of the IRA tax credits, including among some Republican politicians and in the oil and gas industry. Support for blue hydrogen, in particular, is one of the incentives that is most likely to be retained under the new administration and Congress."
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