February 26, 2024
The Honorable Lily L. Batchelder
Assistant Secretary (Tax Policy)
U.S. Department of the Treasury
1500 Pennsylvania Avenue N.W.
Washington, D.C. 20220
William M. Paul, Esq.
Acting Chief Counsel
Internal Revenue Service
1111 Constitution Avenue N.W.
Washington, D.C. 20224
Re: Section 45V Credit for Production of Clean Hydrogen, Section 48(a)(15) Election to Treat Clean Hydrogen Production Facilities as Energy Property (REG-117631-23)
Dear Assistant Secretary Batchelder and Mr. Paul:
The undersigned associations welcome the opportunity to comment on the proposed regulations promulgated under sections 45V and 48(a)(15) of the Internal Revenue Code, which were published in the Federal Register on December 26, 2023 (the “Proposed Regulations”). The Inflation Reduction Act of 2022 (“IRA”) added section 45V, a tax credit for production of clean hydrogen (the “45V Credit”), to incentivize the rapid growth and deployment of clean hydrogen production in the United States. Clean hydrogen has emerged as an important solution for decarbonizing many hard-to-abate sectors, such as heavy-duty transportation, chemical and industrial processing, ammonia production, steel manufacturing, and more.
The undersigned associations recognize the efforts of the U.S. Department of Treasury (“Treasury”) and the Internal Revenue Service (“IRS”) in coordination with the U.S. Department of Energy (“DOE”), to accelerate investments in and advance clean hydrogen production. However, we are deeply concerned that the Proposed Regulations will deter and/or halt investment and deployment of clean hydrogen. As detailed in the attached comment letter, the undersigned associations explain how the Proposed Regulations are unduly burdensome, suffer from significant legal vulnerabilities, and generate uncertainty regarding a project’s eligibility for the 45V Credit.
