US Provides Subsidies for Domestic Hydrogen Production... Government Says "Activation of Korean Companies' Projects"

The government expressed optimism following the announcement of subsidy support for clean hydrogen production in the United States.

On the 22nd (local time), the U.S. Department of the Treasury and the Internal Revenue Service announced that subsidies of up to $3 per kilogram would be provided for clean hydrogen production within the United States.

According to the Ministry of Trade, Industry and Energy on the 23rd, the U.S. government released a provisional guidance on the IRA clean hydrogen production tax credit (45V) based on this content. The provisional guidance defines key legal terms such as 'lifecycle greenhouse gas emissions,' 'qualified clean hydrogen,' and 'qualified clean hydrogen production facility,' and includes a four-tier clean hydrogen production tax credit based on emissions from the hydrogen production process.

Depending on the requirements, subsidies range from $0.6 to $3 per kilogram of hydrogen. The tax credit applies for 10 years from the date the hydrogen production facility begins operation for projects that start construction before 2033. Lifecycle greenhouse gas emissions are basically determined according to the latest model of the U.S. Argonne National Laboratory’s greenhouse gas emissions analysis model (GREET), called '45VH2-GREET.'

For the Energy Attribute Certificate (EAC), three principles must be met: additionality, geographic correlation, and temporal correlation. Additionality means that power supply must come from newly constructed renewable energy facilities within three years of hydrogen production. Geographic correlation requires that power supply comes from the same region as the hydrogen production facility. Temporal correlation matches the greenhouse gas emissions of the power supplied during the same time period as hydrogen production.

This guidance is expected to impact domestic companies as well. Korean companies are pursuing projects to establish clean hydrogen supply chains in various regions such as North America, the Middle East, and Australia to secure hydrogen, a future energy source, stably.

The government anticipates that stable and economical clean hydrogen production in the U.S. and its import into Korea will be feasible. The Ministry of Trade, Industry and Energy stated, "Domestic companies are expected to analyze the eligibility for tax credits based on the clean hydrogen production tax credit requirements and the greenhouse gas emissions calculation model for hydrogen, and to further accelerate clean hydrogen projects in the U.S."

Meanwhile, the Ministry plans to submit opinions to the U.S. side as needed to reflect the views of the Korean industry.

This content was produced with the assistance of AI translation services.