As we previously covered in our blog last week, both the Federal and certain State governments are proposing legislation to subsidize or otherwise enhance the use of hydrogen as an alternative fuel to reduce greenhouse gas emissions from selected “hard to abate” industrial sectors such as heavy industry, transportation and marine shipping.  Last week’s blog focused on federal legislation. This week, we focus on California legislation.

In an effort to lead on the transition to low carbon energy by supporting the use of hydrogen, the California Legislature is considering two bills that require commissions to establish assessment goals for hydrogen use in certain applications and prioritize the use of clean hydrogen statewide.

First, SB-414 would require the State Air Resources Board, in consultation with the State Energy Resources Conservation and Development Commission (Energy Commission) and the Public Utilities Commission, to complete an assessment of the use of hydrogen in certain applications, including light-, medium-, and heavy-duty vehicles, including long-distance trucks and trains, household and commercial appliances, and electricity generation. The assessment must evaluate the potential for reductions in emissions of greenhouse gases using hydrogen, the cost associated with replacing fossil fuels with hydrogen, the energy efficiency of using hydrogen, and the climate risk associated with the transportation, storage, and use of hydrogen for the application. The bill would then require these findings be used when considering the “planning, implementation, or regulation of hydrogen production, distribution, storage, or usage in the state.” After passing the Senate Floor on May 24, 2023, and the Assembly Committee on Natural Resources on June 19, 2023, the bill was re-referred to the Committee on Appropriations on June 20, 2023.

Second, though not a bill per se, Senate Concurrent Resolution (SCR) 21 acknowledges the importance of hydrogen in the clean energy transition and urges the Alliance for Renewable Clean Hydrogen Energy Systems (aka ARCHES, a public-private partnership organization) to prioritize the use of renewable, clean hydrogen for California in its effort to create “Hydrogen Hubs.” These hubs are a part of President Biden’s Infrastructure Investment and Jobs Act (IIJA) in which Congress has allocated $8 billion toward establishing a network of hydrogen hubs. ARCHES is leading California’s regional application of the project. Existing California law already defines the different types of hydrogen, including green electrolytic, clean hydrogen, and renewable hydrogen. The definitions of these terms can be found in the Senate Floor Analysis of the resolution from March 22, 2023. This resolution specifically is intended to further support the use of hydrogen derived from eligible renewable energy resources, including wind, solar thermal, and biomass. The resolution passed the Senate Floor on April 27, 2023, and was adopted and ordered to the Assembly Consent Calendar by the Assembly Committee on Transportation on July 5, 2023.

The above legislation reflects California’s continued attempts to reduce greenhouse gas emissions through the use and assessment of hydrogen. Other states are watching closely and are considering similar measures as well. We will continue to closely monitor the status of hydrogen bills throughout the legislative process at both the federal and state level.