A proposed amendment to a draft bill in the California State Legislature could impose stricter regulations on hydrogen production and use, potentially surpassing federal guidelines. 


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The amendment, part of Assembly Bill 1550 introduced by Democratic assembly member Steve Bennett, aims to eliminate grey and blue Hydrogen in power and transport applications.

Key Points:

1. Ban on Grey and Blue Hydrogen:The proposed amendment seeks to ban the use of grey and blue hydrogen in power generation and transportation in California. This marks a significant step toward promoting cleaner hydrogen sources and discouraging fossil gas-based hydrogen production.

2. Hourly Matching Requirements for Green Hydrogen: The draft bill aligns with controversial federal guidelines by making hourly matching requirements for green hydrogen a legal compliance factor in California. This could impact tax credits and set standards for the hydrogen industry’s environmental impact.

3.Transition to 100% Renewable Hydrogen: If passed, the amendment would require renewable hydrogen to constitute 100% of all hydrogen produced or dispensed by refuelling stations in California by 2045. The bill introduces unspecified interim targets to monitor progress.

4.Electrolysis Mandate: The bill mandates that all hydrogen used in power generation and as a transport fuel in the state must be produced via electrolysis using newly-built renewable or biomass-fired power. This effectively bans the production and use of blue and grey hydrogen with fossil gas in these segments by 2045.

5. Tightened Rules on Green Hydrogen Production: A leaked amendment suggests further tightening of rules, requiring hydrogen produced from renewable or curtailed electricity to match the power delivery hour, making it “green.” This move emphasises real-time adherence and additional standards for green hydrogen production.

Steve Bennett’s office clarified that the bill specifically targets hydrogen for fuelling vehicles and power generation, not imposing an outright ban on fossil-based hydrogen production. This nuanced approach acknowledges different applications and aligns with the state’s green hydrogen market strategy.

The draft bill is currently in the California State Assembly, awaiting a third reading. If passed in the lower house, it will proceed to the State Senate. Governor Gavin Newsom will then have the opportunity to approve or veto the bill, emphasising the multifaceted legislative journey ahead. 

The proposed rules in California mirror federal efforts outlined in the Biden administration’s draft guidance for the 45V clean hydrogen production tax credit. While aligned with the push for cleaner energy, the California amendment also highlights state-specific considerations, potentially shaping the future of hydrogen regulations.