HB0161 creates a new Wyoming severance tax on hydrogen production. The bill defines “hydrogen production” as the separation of hydrogen from water produced from the ground, and it directs the Department of Revenue to annually value and assess that production at fair market value. The tax would be imposed on the gross product from hydrogen production and would be in addition to other taxes already owed under state law.
The bill sets different tax rates depending on the source of the hydrogen. Hydrogen produced from by-product water would be taxed at 3%, while all other hydrogen produced from water would be taxed at 6%. The bill also incorporates existing severance-tax rules for valuation, exemptions, compliance, enforcement, remedies, and revenue distribution, and it applies to hydrogen production on or after July 1, 2025.
Impact
HB0161 would amend Wyoming’s mine product tax framework by adding a new statutory section for hydrogen severance taxation. It would extend existing natural-gas valuation and severance-tax administration provisions to hydrogen, making hydrogen producers and owners of hydrogen interests liable for tax, penalties, and interest. The bill would also route hydrogen severance tax revenues through the state’s existing distribution system for severance taxes, affecting producers, owners, and state revenue streams tied to mineral and energy development.
Sentiment
No committee transcripts or recorded votes were provided, so there is no direct evidence of support or opposition in the available materials. Based on the bill text alone, the measure appears to be a revenue and tax-administration bill rather than a controversial regulatory overhaul. The absence of recorded discussion makes it difficult to assess whether stakeholders viewed it as a targeted modernization of tax law or as a new burden on emerging hydrogen projects.
Contention
The main potential point of contention is the imposition of a new severance tax on hydrogen production, especially for developers and operators of hydrogen projects who may view the 3% and 6% rates as affecting project economics. Another possible issue is the bill’s treatment of hydrogen as analogous to natural gas for valuation and administration, which could raise questions about how the tax base is calculated and whether different hydrogen production pathways are being treated fairly. No specific objections or amendments are documented in the provided record.
Relating to incentives for the development of the clean hydrogen industry in this state, including tax benefits, loans, and grants for clean hydrogen projects, clean hydrogen workforce development, hydrogen powered motor vehicles, and certain items used to produce clean hydrogen.
Safe Drinking Water, Wildfire Prevention, Drought Preparedness, and Clean Air Bond Act of 2024: Administrative Procedure Act: exemption: program guidelines and selection criteria.