Overview
Section 45V provides a production tax credit for the production of qualified clean hydrogen. The credit amount varies based on the lifecycle greenhouse gas emissions rate of the hydrogen produced, with higher credits for hydrogen produced with lower emissions. This credit is designed to accelerate the development of clean hydrogen as a key component of the clean energy transition.
Credit Structure
Base credit (highest tier)
For hydrogen with lifecycle GHG emissions less than 0.45 kg CO2e/kg H2
With Prevailing Wage & Apprenticeship
Enhanced credit (highest tier)
With prevailing wage and apprenticeship requirements (5x multiplier)
Bonus Multipliers
Emissions Tier 1
+100%Full credit for lifecycle emissions < 0.45 kg CO2e/kg H2
Emissions Tier 2
+75%0.45 – 1.5 kg CO2e/kg H2 lifecycle emissions
Emissions Tier 3
+60%1.5 – 2.5 kg CO2e/kg H2 lifecycle emissions
Emissions Tier 4
+20%2.5 – 4 kg CO2e/kg H2 lifecycle emissions
Eligibility & Requirements
- 1Hydrogen must be produced in the United States
- 2Lifecycle GHG emissions must be below 4 kg CO2e per kg of hydrogen
- 3Verification by qualified third-party required
- 410-year credit period from facility placed in service date
- 5Must use approved lifecycle analysis methodology
Direct Pay Election
Tax-exempt entities may elect direct payment for Section 45V credits on qualified clean hydrogen production facilities.
Learn More About Direct Pay