The charitable reading of the grant of statutory authority in the clean hydrogen credit under section 45V(f) is that Congress gave Treasury considerable regulatory leeway to tell claimants how to determine the life cycle greenhouse gas emissions that the entire credit hinges on. The less charitable interpretation is that Congress abdicated its responsibility and left Treasury and the IRS to determine the scope of a tax credit that might cost $34.8 billion over 10 years, or much more.
Section 45V(f) says that Treasury has a year from the date of enactment to “issue regulations or other guidance to carry out the purposes of this section, including regulations or other guidance for determining lifecycle greenhouse gas emissions.” That deadline, August 16, 2023, is nearly upon us. And it is a very big deal, as many surprised podcast listeners, online streaming service viewers, and newspaper readers who probably don’t follow energy tax developments have recently learned from paid advertisements. The ads are a novel and not at all positive — regardless of what direction one thinks the guidance should take — development in the tax rulemaking process.
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