A bill in the Legislature that would expand the ability of public utilities to produce, sell and distribute hydrogen produced by non-fossil feedstock methods cleared its first set of hurdles Friday with support in the House Environment and Energy Committee.
House Bill 1792 is being cosponsored by 20th Legislative District Reps. Peter Abbarno, R-Centralia, and Ed Orcutt, R-Kalama. The bill was first introduced by Rep. Alex Ramel, D-Bellingham, and has seen bipartisan support.
In an emailed statement to The Chronicle, Abbarno said the bill helps to build off hydrogen energy opportunities and incentives previously established, while supporting efforts locally in Lewis County to utilize the energy source.
Chehalis is due to become home of Washington’s first renewable hydrogen refueling station sometime next year.
“HB 1792, which passed unanimously from the House Environment and Energy Committee, authorizes and incentivizes the expansion of hydrogen through tax exemptions. The passage of HB 1792 builds on the green hydrogen refueling station infrastructure funds I was able to help secure in the 2021 Capital Budget,” Abbarno said in a statement.
“There is a lot of effort and focus to help leverage our ideal location between Seattle and Portland to build and produce this type of clean transportation fuel,” he continued.
If passed, HB 1792 would allow public utility districts (PUDs) the ability to produce, use, sell and distribute green electrolytic hydrogen, and would allow municipal utilities the same authorization with green electrolytic hydrogen and renewable hydrogen.
Electrolytic hydrogen is produced by way of “electrolysis,” a chemical process which energizes H20 to separate the compounds into hydrogen and oxygen molecules. Where the energy comes from to produce electrolysis can determine the gas’s cleanliness. Renewable hydrogen is produced through “renewable” sources that cannot be depleted, such as wind or solar.
The bill would also add the production of green electrolytic hydrogen to a number of existing tax exemptions that currently apply to renewable hydrogen, and would create a public utility tax exemption on retail sales tax, use tax and leasehold excise tax through 2025.
“There are no naturally-occurring sources for hydrogen, this isn’t something we can mine. If we want to use hydrogen we have to make it. And there’s really two primary ways that we know to make hydrogen: We could use natural gas, most of which is produced by fracking. This bill does not encourage that, and I don’t think that should have a significant role in a clean energy future. But we can also make hydrogen using electricity, which is what this bill aims to support,” Ramel told the House Environment and Energy Committee on Tuesday.
Ramel said the bill is important because it continues to build off the state’s already-existing clean energy goals, and gives them the opportunity to further decarbonize sectors such as heavy trucking, industrial processes and transoceanic shipping.
The bill also stipulates a tax exemption from the public utility tax given on the sale of electricity to businesses involved in renewable or electrolysis production that would last 25 years.
“We can hit our 2030 climate goals without a big, robust hydrogen sector, but it’s harder to see how we could meet our 2030 or 2050 goals. We ought to be thinking several steps ahead in this game and that’s why I’ve introduced this legislation,” Ramel said.
Dave Warren, a lobbyist representing Renewable Hydrogen Alliance and Green Hydrogen Alliance during Tuesday’s public hearing, said this legislation would continue to build off the state’s reputation as a leader in energy and hydrogen innovation.
Testing and manufacturing on hydrogen-fuel based airplanes, ferries, semis and packing trucks are already happening across Washington. Local universities have also stepped up to develop nationally-recognized energy research institutions.
“The bill adds a suite of policies adopted by the Legislature since 2019 that is arguably the most advanced suite of policies in the nation supporting the development of the hydrogen ecosystem, and it will further signal our state’s support and positions as to lead in the application for one of the $2 billion hydrogen hub grants provided for in the bipartisan Infrastructure and Jobs Act,” Warren said.
The bill also garnered the support of Seattle City Light as well as Tacoma Public Utilities, which sees hydrogen production as a way to offset the abundance of energy output from its four hydroelectric projects into clean hydrogen. Tacoma has also piloted an electrofuel tariff project to support this production.
Hydrogen Infrastructure in Need Locally, Auto Retailer Tells Lewis Energy Coalition
During a quarterly meeting of the Lewis County Energy Innovation Coalition held Tuesday, I-5 Cars Vice President Robert Pehl told community stakeholders that continued lobbying for tax incentives and infrastructure investments were needed in order to bring wholesale vehicles, such as the Toyota Mirai, to Lewis County.
Pehl as well as John Cornish, president of Cheyenne, Wyoming-based EPC consulting firm, were the keynote presenters at the meeting. Cornish’s firm focuses on the design and implementation of hydrogen electrolysis systems.
“The most important thing for us to understand is that we cannot sell or offer a vehicle without that infrastructure, and even on the EV (electric vehicle) side of things, we still do not have the infrastructure needed to really move that needle to actually make an impact on the environment and world at large,” he said, noting they need the “public support” similar to what’s being seen in California, the only state where the Mirai is sold.
But, Pehl said, they are moving in the right direction, especially with the plan to bring the hydrogen refueling station to Chehalis and as Lewis County considers building an electrolyzer. That will allow them to have the first technicians in Washington state trained in servicing and repairing hydrogen-fuel cell vehicles.
“We’re advocates for clean energy and we see that not only as a great thing for our environment, but as also a great economic motor for our area,” Pehl said, noting that EVs or hydrogen-fuel cell vehicles may not be for everyone.
The next Energy Innovation Coalition meeting will be set for a date to be determined in April.