,,ii #aag? ,,congress #a/ ,session ,s4 #ahjg ,,9 ,,! ,,s5ate ,,( ,,! ,,unit$ ,,/ates ,may #be1 #bjba,mr4 ,c>p] introduc$ ! foll[+ bill2 :i* 0 read twice & ref]r$ to ! ,committee on ,f9ance ,a ,,bill ,to am5d ! ,int]nal ,rev5ue ,code ( #aihf to provide = a production & inve/m5t tax cr$it relat$ to ! production ( clean hydrog54 #a4 ,%ort title ,?is ,act may be cit$ z ! ,clean ,h#b ,production ,act4 #b4 ,tax cr$it = production ( clean hydrog5 7a7 ,9 g5]al ,subp>t ,d ( "p ,,iv ( sub*apt] ,a ( *apt] #a ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by add+ at ! end ! foll[+ new section3 #de,u4 ,cr$it = production ( clean hydrog5 7a7 ,am\nt ( cr$it ,= purposes ( section #ch1 ! clean hydrog5 production cr$it = any taxable ye> is an am\nt equal to ! product (-- 7#a7 ! applicable am\nt1 multipli$ by 7#b7 ! kilograms ( qualifi$ clean hydrog5-- 7,a7 produc$ by ! taxpay] at a qualifi$ clean hydrog5 production facility dur+ ! #aj-ye> p]iod beg9n+ on ! date ! facility 0 plac$ 9 s]vice1 & 7,b7 7i7 sold by ! taxpay] to an unrelat$ p]son dur+ ! taxable ye>1 7ii7 us$ by ! taxpay] or a relat$ p]son dur+ ! taxable ye>1 or 7iii7 /or$ dur+ ! taxable ye> = subsequ5t use by ! taxpay] or a relat$ p]son4 7b7 ,applicable am\nt 7#a7 ,9 g5]al ,= purposes ( subsection 7a77#a71 ! applicable am\nt %all be an am\nt equal to ! applicable p]c5tage ( #c4jj4 ,if any am\nt z det]m9$ "u ! prec$+ s5t5ce is n a multiple ( #j4a c5t1 su* am\nt %all be r\nd$ to ! ne>e/ multiple ( #j4a c5t4 7#b7 ,applicable p]c5tage ,= purposes ( p>agraph 7#a71 ! t]m applicable p]c5tage means-- 7,a7 9 ! case ( any qualifi$ clean hydrog5 :i* is produc$ ?r\gh a process t1 z comp>$ to hydrog5 produc$ by /eam-me?ane re=m+1 a*ieves a p]c5tage r$uction 9 lifecycle gre5h\se gas emissions :i* is less ?an #ge p]c5t1 #bj p]c5t1 7,b7 9 ! case ( any qualifi$ clean hydrog5 :i* is produc$ ?r\gh a process t1 z comp>$ to hydrog5 produc$ by /eam-me?ane re=m+1 a*ieves a p]c5tage r$uction 9 lifecycle gre5h\se gas emissions :i* is n less ?an #ge p]c5t & less ?an #he p]c5t1 #be p]c5t1 7,c7 9 ! case ( any qualifi$ clean hydrog5 :i* is produc$ ?r\gh a process t1 z comp>$ to hydrog5 produc$ by /eam-me?ane re=m+1 a*ieves a p]c5tage r$uction 9 lifecycle gre5h\se gas emissions :i* is n less ?an #he p]c5t & less ?an #ie p]c5t1 #cd p]c5t1 & 7,d7 9 ! case ( any qualifi$ clean hydrog5 :i* is produc$ ?r\gh a process t1 z comp>$ to hydrog5 produc$ by /eam-me?ane re=m+1 a*ieves a p]c5tage r$uction 9 lifecycle gre5h\se gas emissions :i* is n less ?an #ie p]c5t1 #ajj p]c5t4 7#c7 ,inflation adju/m5t ,! #c4jj am\nt 9 p>agraph 7#a7 %all be adju/$ by multiply+ su* am\nt by ! inflation adju/m5t factor 7z det]m9$ "u section #de7;e77#b71 det]m9$ by sub/itut+ #bjbj = #aiib 9 subp>agraph 7,b7 !re(7 = ! cal5d> ye> 9 :i* ! sale or use ( ! qualifi$ clean hydrog5 occurs4 ,if any am\nt z increas$ "u ! prec$+ s5t5ce is n a multiple ( #j4a c5t1 su* am\nt %all be r\nd$ to ! ne>e/ multiple ( #j4a c5t4 7c7 ,cr$it r$uction ,! am\nt ( ! cr$it det]m9$ "u subsection 7a7 ) respect to any qualifi$ clean hydrog5 production facility = any taxable ye> %all be r$uc$ 9 a mann] simil> to ! r$uction appli$ "u section #de7;b77#c74 7d7 ,def9itions ,= purposes ( ?is section-- 7#a7 ,lifecycle gre5h\se gas emissions ,= purposes ( ?is section1 ! t]m lifecycle gre5h\se gas emissions has ! same mean+ giv5 su* t]m "u subp>agraph 7,h7 ( section #baa7o77#a7 ( ! ,clean ,air ,act 7#db ,u4,s4,c4 #gede7o77#a771 z 9 effect on ! date ( enactm5t ( ?is section1 z relat$ to ! full fuel lifecycle ?r\gh ! po9t ( hydrog5 production4 7#b7 ,qualifi$ clean hydrog5 7,a7 ,9 g5]al ,! t]m qualifi$ clean hydrog5 means hydrog5 :i* is produc$ ?r\gh a process t1 z comp>$ to hydrog5 produc$ by /eam-me?ane re=m+ ( non-r5ewable natural gas1 a*ieves a p]c5tage r$uction 9 lifecycle gre5h\se gas emissions :i* is n less ?an #ej p]c5t4 7,b7 ,exclusion ,! t]m qualifi$ clean hydrog5 %all n include any hydrog5 = :i* a cr$it is all[$ = ! taxable ye>-- 7i7 "u section #ch :i* is prop]ly allocable to any cr$it det]m9$ "u ?is "p 7o!r ?an ?is section71 or 7ii7 "u sub*apt] ,b ( *apt] #fe ( subtitle ,f4 7#c7 ,qualifi$ clean hydrog5 production facility 7,a7 ,9 g5]al ,! t]m qualifi$ clean hydrog5 production facility means-- 7i7 a facility own$ by ! taxpay]-- 7,i7 :i* produces qualifi$ clean hydrog5 :i*1 ) respect to any taxable ye>1 is sold by ! taxpay] to an unrelat$ p]son or us$ by ! taxpay]1 7,,ii7 :i* satisfies ! requirem5ts "u subp>agraphs 7,b7 & 7,c71 & 7,,iii7 ! con/ruction ( :i* beg9s be=e ,janu>y #a1 #bjcj1 & 7ii7 9 connection ) any facility describ$ 9 clause 7i71 any prop]ty us$ to conv]t fe$/ock to hydrog51 includ+ any equipm5t or support+ facility :i*-- 7,i7 accepts or receives fe$/ock1 7,,ii7 conditions or /ores fe$/ock or hydrog51 or 7,,iii7 di/ributes or r$i/ributes hydrog54 7,b7 ,wage requirem5ts ,! requirem5ts describ$ 9 ?is subp>agraph ) respect to any facility are t ! taxpay] %all ensure t any labor]s & me*anics employ$ by contractors & subcontractors 9-- 7i7 ! con/ruction ( su* facility1 or 7ii7 = any ye> dur+ ! p]iod describ$ 9 subsection 7a77#b77;,a7 :i* beg9s aft] ! date ( ! enactm5t ( ?is section1 ! alt]ation or repair ( su* facility1 %all be paid wages at rates n less ?an ! prevail+ rates = con/ruction1 alt]ation1 or repair ( a simil> "* 9 ! locality z det]m9$ by ! ,secret>y ( ,labor1 9 accordance ) sub*apt] ,,iv ( *apt] #ca ( title #dj1 ,unit$ ,/ates ,code4 7,c7 ,labor requirem5ts 7i7 ,appr5tice%ips ,! requirem5ts describ$ 9 ?is subp>agraph ) respect to any facility are t ! taxpay] %all ensure t all contractors & subcontractors engag$ 9 ! p]=mance ( con/ruction1 alt]ation1 or repair "w on any facility %all1 subject to clause 7ii71 ensure t n less ?an #ae p]c5t ( ! total labor h\rs ( su* "w be p]=m$ by qualifi$ appr5tices4 7ii7 ,appr5tice-to-j\rneywork] ratio ,! requirem5t "u clause 7i7 %all be subject to any applicable requirem5ts = appr5tice-to-j\rneywork] ratios ( ! ,dep>tm5t ( ,labor or ! applicable ,/ate appr5tice%ip ag5cy4 7iii7 ,p>ticipation ,ea* contractor & subcontractor describ$ 9 clause 7i7 t employs #d or m individuals to p]=m con/ruction1 alt]ation1 or repair "w on any facility %all employ #a or m qualifi$ appr5tices to p]=m su* "w4 7iv7 ,exception ,not)/&+ any o!r provision 9 ?is subp>agraph1 ?is subp>agraph %all n apply 9 ! case ( a taxpay] :o-- 7,i7 demon/rates a lack ( availability ( qualifi$ appr5tices 9 ! geographic area ( ! con/ruction1 alt]ation1 or repair "w1 & 7,,ii7 makes a good fai? ef=t1 & its contractors & subcontractors make a good fai? ef=t1 to comply ) ! requirem5ts ( ?is subp>agraph4 7#d7 ,/eam-me?ane re=m+ ,! t]m /eam-me?ane re=m+ means a hydrog5 production process 9 :i* high-temp]ature /eam is us$ to produce hydrog5 f natural gas1 )\t c>bon capture & seque/ration4 7e7 ,special rules 7#a7 ,9 g5]al ,rules simil> to ! rules ( p>agraphs 7#c7 & 7#d7 ( section #de7;e7 %all apply = purposes ( ?is section4 7#b7 ,production 9 ! ,unit$ ,/ates ,no cr$it %all be all[$ "u ?is section ) respect to any qualifi$ clean hydrog5 :i* is produc$ outside ( ! ,unit$ ,/ates 7z def9$ 9 section #fch7a7 or any possession ( ! ,unit$ ,/ates 7z def9$ 9 section #fch7b774 7f7 ,guidance ,n lat] ?an #a ye> aft] ! date ( enactm5t ( ?is section1 ! ,secret>y1 9 consultation ) ! ,secret>y ( ,en]gy & ,adm9i/rator ( ! ,environm5tal ,protection ,ag5cy1 %all publi% guidance prescrib+ me?ods = det]m9+ ! cr$it bas$ on lifecycle gre5h\se gas emissions4 ,= purposes ( ! prec$+ s5t5ce1 su* me?ods %all consid] ! emissions associat$ ) any fe$/ock or en]gy s\rce :i* is n co-locat$ at ! qualifi$ clean hydrog5 production facility if-- 7#a7 su* fe$/ock or en]gy s\rce is contractually obta9$ by ! taxpay]1 7#b7 ! taxpay] provides suffici5t legal assurances t no o!r p]son c claim cr$it = ! environm5tal attributes ( su* fe$/ock or en]gy s\rce1 & 7#c7 environm5tal attributes ( ! non co-locat$ fe$/ock or en]gy s\rce are only consid]$ to ! ext5t ! taxpay] consumes an equival5t am\nt ( ! fe$/ock or en]gy s\rce 9 ! production ( hydrog51 :]eas-- 7,a7 9 ! case ( electricity us$ to produce hydrog5 !n only an equival5t am\nt ( electricity :i* is n co-locat$ may be consid]$1 & 7,b7 9 ! case ( natural gas us$ to produce hydrog5 !n only an equival5t am\nt ( biogas :i* is n co-locat$ may be consid]$4 4 7b7 ,con=m+ am5dm5ts 7#a7 ,section #ch7;b7 ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$-- 7,a7 9 p>agraph 7#cb71 by /rik+ plus at ! end1 7,b7 9 p>agraph 7#cc71 by /rik+ ! p]iod at ! end & ins]t+ 1 plus1 & 7,c7 by add+ at ! end ! foll[+ new p>agraph3 7#cd7 ! clean hydrog5 production cr$it det]m9$ "u section #de,u7a74 4 7#b7 ,! table ( sections = subp>t ,d ( "p ,,iv ( sub*apt] ,a ( *apt] #a ( su* ,code is am5d$ by add+ at ! end ! foll[+ new item3 ,sec4 #de,u4 ,cr$it = production ( clean hydrog54 4 7c7 ,effective date ,! am5dm5ts made by ?is section %all apply to hydrog5 us$ or sold aft] ,decemb] #ca1 #bjbj4 #c4 ,expansion ( en]gy cr$it to include clean hydrog5 production facilities 7a7 ,9 g5]al ,section #dh7;a77#e7 ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$-- 7#a7 9 subp>agraph 7,a77ii71 by ins]t+ subject to subp>agraph 7,g77i71 be=e ! en]gy p]c5tage1 7#b7 9 subp>agraph 7,b71 by ins]t+ or #de,u aft] section #de1 7#c7 9 subp>agraph 7,c7-- 7,a7 9 clause 7i71 by ins]t+ or1 subject to subp>agraph 7,g77ii71 a qualifi$ clean hydrog5 production facility 7z def9$ 9 section #de,u7d77#c77 :i* meets ! requirem5ts ( section #de,u7b77#b77;,c7 aft] section #de7;d71 7,b7 9 clause 7ii71 by ins]t+ 7or1 9 ! case ( a qualifi$ clean hydrog5 production facility1 :i* is plac$ 9 s]vice aft] #bjbj & ! con/ruction ( :i* beg9s be=e ,janu>y #a1 #bjcj7 aft] ,janu>y #a1 #bjbb1 & 7,c7 9 clause 7iii77,i71 by ins]t+ or #de,u aft] section #de1 & 7#d7 by add+ at ! end ! foll[+3 7,g7 ,qualifi$ clean hydrog5 production facilities 7i7 ,en]gy p]c5tage 7,i7 ,9 g5]al ,= purposes ( subp>agraph 7,a77ii71 9 ! case ( a qualifi$ inve/m5t cr$it facility :i* is a qualifi$ clean hydrog5 production facility1 ! en]gy p]c5tage ) respect to su* facility %all be an am\nt 7express$ z a p]c5tage7 equal to-- 7aa7 9 ! case ( a facility :i* is e/imat$ to produce qualifi$ clean hydrog5 7z def9$ 9 describ$ 9 section #de,u7d77#b77 :i* is describ$ 9 subp>agraph 7,a7 ( section #de,u7b77#b71 #bj p]c5t ( ! en]gy p]c5tage o!rwise applicable "u subp>agraph 7,a77ii71 7bb7 9 ! case ( a facility :i* is e/imat$ to produce qualifi$ clean hydrog5 :i* is describ$ 9 subp>agraph 7,b7 ( section #de,u7b77#b71 #be p]c5t ( ! en]gy p]c5tage o!rwise applicable "u subp>agraph 7,a77ii71 7cc7 9 ! case ( a facility :i* is e/imat$ to produce qualifi$ clean hydrog5 :i* is describ$ 9 subp>agraph 7,c7 ( section #de,u7b77#b71 #cd p]c5t ( ! en]gy p]c5tage o!rwise applicable "u subp>agraph 7,a77ii71 & 7dd7 9 ! case ( a facility :i* is e/imat$ to produce qualifi$ clean hydrog5 :i* is describ$ 9 subp>agraph 7,d7 ( section #de,u7b77#b71 #ajj p]c5t ( ! en]gy p]c5tage o!rwise applicable "u subp>agraph 7,a77ii74 7,,ii7 ,recapture ,! ,secret>y %all1 by regulations1 provide = recaptur+ ! b5efit ( any cr$it all[able "u ?is section ) respect to any qualifi$ clean hydrog5 production facility :i* significantly fails to produce qualifi$ clean hydrog5 consi/5t ) ! applicable p]c5tage r$uction 9 lifecycle gre5h\se gas emissions describ$ 9 section #de,u7b77#b7 :i* 7 e/imat$ = su* facility pursuant to subclause 7,i74 7ii7 ,no d\ble b5efit ,= purposes ( ?is p>agraph1 ! t]m qualifi$ inve/m5t cr$it facility %all n include any qualifi$ clean hydrog5 production facility = :i* a cr$it is all[$ "u section #ch = ! taxable ye> or any prior taxable ye> :i* is prop]ly allocable to any cr$it det]m9$ "u-- 7,i7 ?is section 7o!r ?an pursuant to ?is p>agraph71 or 7,,ii7 section #de1 #de;,j1 or #de,q4 4 7b7 ,effective date ,! am5dm5ts made by ?is section %all apply to prop]ty plac$ 9 s]vice aft] ,decemb] #ca1 #bjbj4