§ 36 — Analysis of hydrogen production and utilization

(a) No later than April 1, 2028, the Illinois Environmental Protection Agency, in consultation with the Department, the Illinois Power Agency, the Illinois Commerce Commission, and other State agencies, as needed, shall publish a report analyzing the greenhouse gas and copollutant emissions impacts of hydrogen production and utilization in the State from January 1, 2026 through December 31, 2027. The report shall separately measure each of the following: (1) life-cycle greenhouse gas and copollutant emission impacts of producing qualifying hydrogen; (2) life-cycle greenhouse gas and copollutant emission impacts of eligible qualifying hydrogen use for which an eligible taxpayer receives a credit under this Act; (3) any greenhouse gas and copollutant emissions avoided by eligible use of qualifying hydrogen, such as by displacing diesel in long-haul, heavy-duty trucking and displacing hydrogen created using fossil fuel feedstock or through electrolysis powered by fossil-fuel generated electricity, where avoidance can be determined with reasonable certainty; and (4) economic activity and jobs attributable to investments in qualifying hydrogen production and eligible qualifying hydrogen use in the State across sectors. The report shall also include the following separate provisions: (1) an analysis of opportunities to increase the production of qualifying hydrogen from electrolysis that is powered entirely by electricity generated from qualified renewable energy resources in the State; (2) a comparison of the cost of qualifying hydrogen to the cost of hydrogen produced from fossil fuels; (3) an analysis of whether energy sources other than hydrogen are available alternatives for qualified uses, and if so, whether those alternatives would achieve greater emissions reductions, economic savings, or both; (4) an analysis of the efficacy of this tax credit at incentivizing the transition of industries with eligible uses to use clean hydrogen as a means of decarbonization; (5) an analysis of Illinois' competitiveness in the clean hydrogen economy relative to other states; this analysis shall include, but not be limited to, a review of the Department of Energy's Hydrogen Hub awards, other states' incentives for clean hydrogen, the amount of eligible use of clean hydrogen in Illinois relative to other states, and the amount of production of clean hydrogen in Illinois relative to other states; this analysis should also recommend policy changes the State can make to be more competitive with other states in the clean hydrogen economy to the extent that such competitiveness is consistent with the State's emissions reductions goals and is economically beneficial; (6) an analysis of areas where clean hydrogen use, clean energy use, or both can increase emissions reduction, and policy measures the State can take to incentivize those uses, including, but not limited to, an extension of this tax credit and changes to the total annual amount of this tax credit; and (7) an analysis of the expected arc of production, relative costs of different methods of hydrogen production, relative costs and emissions reductions benefits of clean energy produced by other methods, including renewables, for eligible and other uses to help right-size the total tax credit amount. The Illinois Environmental Protection Agency may consider application and attestation information provided by eligible taxpayers pursuant to this Act and any other data it deems relevant. Data relied upon for the report and methods of measurement shall be identified in the report and be made publicly available in easily accessible, machine-readable format. The Illinois Environmental Protection Agency shall determine and state in its report the impact of the production of qualifying hydrogen and eligible qualifying hydrogen uses receiving a tax credit pursuant to this Act on greenhouse gas and copollutant emissions. (b) A draft of the report shall be made available for public comment no less than 30 days prior to its final publication. The final report and comments received shall be made publicly available in both English and Spanish, and copies of the final report shall be filed with the General Assembly and the Governor.

Legislative History

(Source: P.A. 103-268, eff. 7-25-23.)