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October 19, 2023
DOE Appropriations for Hydrogen and Fuel Cell Activities:
FY2024
The U.S. Department of Energy (DOE) Hydrogen Program
thermal comfort). DOE’s June 2023 National Clean
addresses the development of applications that use
Hydrogen Strategy and Roadmap envisages 10 million
hydrogen in place of today’s fuels to provide modern
metric tons of new production of hydrogen by 2030, further
energy services. The program also considers hydrogen as an
stipulated to be clean hydrogen as defined in statute and
established industrial chemical, for example, in petroleum
DOE regulation. The Strategy and Roadmap has three focal
refining. The DOE program includes over 400 projects
points: increasing the use of industrial applications,
involving research and development (R&D), systems
including heavy-duty transportation and energy storage;
integration, and demonstration and deployment activities—
reducing the cost of clean hydrogen; and developing
collectively performed by universities, national
regional networks through the Regional Clean Hydrogen
laboratories, and industry. These activities cover the energy
Hubs (§40314 of IIJA). DOE’s “Hydrogen Shot” goal for
value chain starting with producing hydrogen from diverse
the cost of hydrogen is $1 per kilogram by 2031, not
feedstocks; transporting and storing it; and finally using it
including delivery and dispensing, for production using
in various applications. The program is led by the Hydrogen
electrolyzers that split water to make the hydrogen.
and Fuel Cell Technologies Office (HFTO) within the DOE
Currently the cost of hydrogen made with electrolyzers is
Office of Energy Efficiency and Renewable Energy
roughly $5/kg.
(EERE).
DOE Spending
A future “hydrogen economy” using hydrogen as an energy
Within DOE, two offices—EERE and the Office of Fossil
carrier and fuel could offer an alternative to today’s
Energy and Carbon Management—were responsible for
economy with its prevalent combustion of fossil fuels.
executing over 80% of DOE’s budget authority on
Initially thought of as a new technology for personal
hydrogen and fuel cells from the FY2023 annual
mobility services (e.g., cars) and high-value applications
appropriation. The Office of Nuclear Energy and Office of
such as provision of electric power during space flight,
Science received smaller amounts. The DOE-wide total was
hydrogen now is receiving attention for industrial
$437.5 million in FY2023, including $20.0 million
processes, heavy vehicles, forklifts, portable power, and
announced by ARPA-E (Advanced Research Projects
buffering and balancing of electric power. In addition to
Agency-Energy) in September 2023.
annual appropriations on hydrogen, legislation enacted in
the 117th Congress funded hydrogen programs and provided
Figure 1. FY2024 President’ Budget Request for the
incentives for production of hydrogen that meets certain
DOE Hydrogen Program, by Office ($million)
criteria. For more information, see CRS Report R47487,
The Hydrogen Economy: Putting the Pieces Together, by
Martin C. Offutt.
Federal Hydrogen Programs
Authorizing Legislation
The Electric and Hybrid Vehicle Research, Development,
and Demonstration Act of 1976 (P.L. 94-413) authorized a
federal hydrogen program, initially at the National Science
Foundation. Congress transferred overall management
responsibility of the hydrogen program to DOE with the
Spark M. Matsunaga Hydrogen Research, Development,
and Demonstration Program Act of 1990 (P.L. 101-566).
The Energy Policy Act of 2005 (EPAct, P.L. 109-58) and
its amendments, including the Infrastructure Investment and
Jobs Act (IIJA, P.L. 117-58), further defined the program’s
Source: Department of Energy FY2024 Congressional
scope and purpose.
Justification: Vol. 2: Crosscutting Activities, March 2023. ARPA-E funding
The DOE Program
for hydrogen is determined annual y based on programs developed
through office and stakeholder priorities and defined, in part, by the
The DOE Hydrogen Program includes several offices with
proposals it receives and awards.
responsibility for supporting hydrogen work based on
different sources of energy (e.g., renewable, fossil, nuclear)
For FY2024, the President’s budget request included
and types of end-use (e.g., vehicles, portable power,
$381.6 million (see Figure 1). The House Appropriations
https://crsreports.congress.gov
link to page 1 DOE Appropriations for Hydrogen and Fuel Cell Activities: FY2024
Committee reported H.R. 4394, the Energy and Water
from basic research on fuel cells to activities aimed at early
Development and Related Agencies Appropriations Act,
deployment, including demonstrations of fuel cells in
2024, on June 30, 2023. The bill text and accompanying
applications such as fork lifts and unmanned underwater
report (H.Rept. 118-126) did not specify a DOE-wide total
and aerial vehicles.
for hydrogen programs. On July 20, 2023, the Senate
Appropriations Committee reported S. 2443, the Energy
P.L. 117-169, commonly known as the Inflation Reduction
and Water Development and Related Agencies
Act of 2022 (IRA), created the Clean Hydrogen Production
Appropriations Act, 2024, and recommended not less than
Tax Credit in Internal Revenue Code Section 45V (IRC
$390.0 million for the DOE-wide total (S.Rept. 118-72). In
45V, §13204). The Treasury Department issued Notice
addition to annual appropriations, DOE received but has not
2022-58 in November 2022 for comment on implementing
yet obligated funds from the IIJA. These unexpended
the IRC 45V tax credit. As of mid-October 2023, the
balances include funds for the seven Regional Clean
Treasury Department had not issued the guidance. The
Hydrogen Hubs (IIJA §40314) announced on October 13,
Senate Appropriations Committee (S.Rept. 118-72)
2023—a program which received $1.6 billion in each of
instructed DOE to support updates to GREET, the model
FY2022 through FY2024. Unexpended balances also
the IRA requires be used to determine if the well-to-gate
include funds for two programs—Clean Hydrogen
emission of greenhouse gas emissions are below the
Manufacturing and Recycling Research, Development, and
threshold for eligibility for the tax credit.
Demonstration; and Clean Hydrogen Electrolysis—which
received $300 million in each of FY2022 through FY2024.
Recent Developments
DOE began the procurement process in March 2023 for the
The IIJA authorized the Secretary of Energy to publish an
first $750 million of these latter two programs and
initial standard for the “carbon intensity of clean hydrogen
anticipates award negotiations to occur in winter
production” (CHP) and to review it at five-year intervals.
2023/2024.
DOE issued its guidance in June 2023 and arrived at a
standard of 4 kilograms carbon dioxide equivalent (kg CO2-
For FY2024, the House Appropriations Committee
equivalent) per kilogram hydrogen (kg H2). Like the IRC
included $138.0 million for HFTO, $25.1 million below the
45V credit, this applies to the well-to-factory-gate CO2
President’s request, while the Senate Appropriations
emissions and is the same regardless of the primary source
Committee included $163.1, the same as the President’s
of energy. The 4-kg-CO2 level of the CHP standard is the
request. The funding for HFTO makes up the majority of
same as the upper threshold of the IRC 45V tax credit, with
the pie slice for EERE in Figure 1 and in prior-year
the latter corresponding to $0.60 per kg H2 produced. The
appropriations. Within Vehicle Technologies, the House
CHP standard applies to the Regional Clean Hydrogen
Appropriations Committee recommended $10.0 million for
Hubs (IIJA §40134) and other activities carried out under
novel, more efficient hydrogen combustion engines—a
EPAct Title VIII—Hydrogen.
figure that was not in the President’s request.
DOE announced $48 million in funding for projects on
Where DOE Spends the Money
advanced clean hydrogen technologies on September 20,
DOE’s Hydrogen Program awards grants, contracts, and
2023. DOE envisages these investments as complementary
cooperative agreements to investigators at universities,
to the IRC 45V tax credit and the Regional Clean Hydrogen
industry, and national laboratories. This supports more than
Hubs in realizing the Hydrogen Shot goal of $1 per
400 projects. These include R&D focused on the hardware,
kilogram of hydrogen produced by 2031.
such as the fuel cell, for a hydrogen economy. R&D is
intended to reduce cost and improve performance of
Congressional Considerations
production and end-use technology and other parts of the
Both appropriations committees stated that DOE should
hydrogen value chain. The projects also include work at
coordinate hydrogen and fuel cell programs across DOE
higher levels of integration, such as to validate first-of-a-
offices. The Senate committee also expressed concern about
kind systems, reduce technological risk, and address the
the number of coordination mechanisms, including
other aspects of a hydrogen economy (e.g., safety, codes
crosscuts and Earthshots, such as the Hydrogen Shot
and standards, and workforce development). In H.Rept.
discussed above, and would direct DOE to simplify and
118-126, the House Appropriations Committee encouraged
consolidate these into one function.
DOE to examine the potential of hydrogen to provide
power for electric vehicle charging in grid-constrained
The IIJA required that DOE consider a number of goals
locations.
(e.g., long-term employment) for the Regional Clean
Hydrogen Hubs and established timetables for DOE’s
Hydrogen Programs at Non-DOE Federal Agencies
implementation of these hubs. How and to what extent
DOE’s HFTO has a coordinating role for hydrogen
DOE implements these goals and how quickly it obligates
activities across the executive branch. Several other
IIJA funding may be of continued interest to Congress. The
agencies—the Department of the Army, National
IIJA set a higher target for the cost of hydrogen than DOE’s
Aeronautics and Space Administration, and Department of
Hydrogen Shot cost goal, each on different timescales. How
the Navy, among others—administer hydrogen programs.
these two goals align in practice may also be of interest to
DOE estimates that, for FY2022 and FY2023 combined,
Congress.
projects funded by non-DOE hydrogen programs totaled
over $70.0 million, an increase of roughly $30.0 million
Martin C. Offutt, Analyst in Energy Policy
from combined FY2019 and FY2020. The projects range
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https://crsreports.congress.gov
DOE Appropriations for Hydrogen and Fuel Cell Activities: FY2024
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