Federal Tax Credits
Financial Incentives for Clean Energy Production
Under the Inflation Reduction Act of 2022 (IRA), the federal government created tax credit opportunities for the production of clean energy including clean fuel (45Z) as of January 2025 and clean hydrogen (45V) production as of January 2023.
Clean Fuel Production (CFPC)
45Z Program
This program creates tax credits for the production and sale of low emission transportation fuels under section 45Z of the internal revenue code.
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Sustainable aviation fuel (SAF) and non-SAF clean fuel production are eligible for tax credits.
Verification of SAF fuel is required for January 1, 2025 production. Non-SAF fuel producers can voluntarily verify their 45Z tax credit to satisfy the safe harbor provisions and increase confidence to those interested in purchasing the tax credit. The 45Z provides tax credit ranges from $0.20 to $1.75 per gallon depending on fuel produced and requirements met
45V Clean Hydrogen Production Tax Credit
This program creates tax credits for production of clean hydrogen under section 45V of the internal revenue code. Varying quantities of tax credits can be generated depending on the carbon intensity of the hydrogen produced. The 45V rule was finalized in 2025 and provides tax credits for qualified clean hydrogen producers for up to $3.00 per kilogram.
Our Strengths
ALG’s team of lead verifiers have completed over 1,000 verifications including projects for the production of various low carbon, clean fuel, and hydrogen projects. ALG’s experience includes the preparation of Life Cycle Analyses (LCA) and use of commercially available LCA models, such as GREET, necessary to demonstrate tax credit eligibility.
