As the U.S. Congress continues its 2025 budget reconciliation process, industry stakeholders continue to monitor the fate of the Inflation Reduction Act’s (IRA) Section 45V Clean Hydrogen Production Tax Credit. The bill, first introduced by the House Ways and Means Committee on May 12, 2025, and advanced by the House Budget Committee on May 18, 2025, as currently written, terminates the Section 45V clean hydrogen tax credit as of January 1, 2026. 

Stakeholders and Policymakers Respond

Since the release of that draft bill, several industry stakeholders and policymakers have made public pronouncements indicating their support for preserving the Section 45V clean hydrogen tax credit. 

Over 100 industry stakeholders, including EcoEngineers, the American Petroleum Institute (API), and the American Biogas Council (ABC), have signed a letter sent by the Fuel Cell and Hydrogen Energy Association (FCHEA) to House Speaker Mike Johnson urging House leadership to preserve Section 45V “without any new restrictions.”

Two days after the House’s reconciliation bill was made public, Sen. Shelley Moore Capito (R-WV), Chair of the Senate Environment and Public Works Committee, indicated a desire to review the proposed termination of Section 45V, citing a clean hydrogen hub in her home state of West Virginia, which was slated to receive nearly $1 billion from the U.S. Department of Energy (USDOE). Regarding the renewable energy tax credits contained in the IRA, Sen. Capito was quoted as saying, “There has been job creation around these tax credits.”

Similarly, Sen. Thom Tillis (R-NC), who sits on the Senate Finance Committee, stated, “You can’t shock the markets by doing it all at once,” in reference to the House’s proposed termination of clean energy tax credits.

As the situation surrounding the Section 45V clean hydrogen tax credit remains fluid, and with narrow majorities in both the House and Senate, congressional leaders will need to garner support from various members representing disparate geographical regions and interests. Among them will be members of the Fuel Cell and Hydrogen Energy Caucus of the 118^th Congress. This caucus is a bipartisan coalition of 39 members of both chambers of Congress who “help educate members of Congress and the public on sustainable and resilient energy solutions.” 

Fate of Section 45V Remains Fluid

At the time of this writing, the budget reconciliation bill continues to be negotiated and working through the House Rules Committee before moving on to a final vote on the floor of the House of Representatives. Once the bill is passed, the reconciliation process will move to committee work in the Senate, before moving to a full Senate floor vote. After passage in both chambers, the two bills will be sent to a conference committee where differences will be reconciled. 

With a sizeable portion of the legislative process still to be completed before the House reconciliation bill becomes law, the termination of the Section 45V clean hydrogen tax credit is far from certain, and its preservation as a catalyst for U.S. domestic clean hydrogen production remains fluid. 

Stakeholders committed to the continued growth of clean hydrogen production in the United States can actively work to preserve the Section 45V clean hydrogen tax credit by contacting their congressional representatives and senators. By ensuring policymakers appreciate the significant impact of the growing domestic U.S. clean hydrogen production sector, and the subsequent job creation and positive economic benefits that stem from that production, the preservation of the Section 45V clean hydrogen tax credit can continue to fuel clean, low-carbon hydrogen production for years to come. 

READ MORE: For further insight into the Section 45V clean hydrogen tax credit, check out the webinar EcoEngineers recently conducted here.

For information about EcoEngineers’ Hydrogen services and capabilities, contact:

Tanya Peacock, Managing Director, California and Hydrogen | tpeacock@ecoengineers.us  

About EcoEngineers

EcoEngineers, an LRQA company, is a consulting, auditing, and advisory firm exclusively focused on the energy transition and decarbonization. From innovation to impact, EcoEngineers helps its clients navigate the disruption caused by carbon emissions and climate change. Its team of engineers, scientists, auditors, consultants, and researchers live and work at the intersection of low-carbon fuel policy, innovative technologies, and the carbon marketplace. For more information, visit www.ecoengineers.us.