Kenneth J. Markowitz Stacey H. Mitchell Dario J. Frommer Christopher A. Treanor February 20 2023 Climate change policy update: State of the Union, green hydrogen and state climate plans Akin Gump Strauss Hauer & Feld LLP | Environment & Climate Change - USA Kenneth J. Markowitz, Stacey H. Mitchell, Dario J. Frommer, Christopher A. Treanor Environment & Climate Change Biden's State of the Union reasserts climate goalsEnvironmental Protection Agency refinery exemptions denial is not subject to Congressional Review ActEnergy companies argue about definition of "green hydrogen"Senate bill to reallocate $11 billion worth of investments in fossil fuel companiesVermont joins multi-state effort to create clean hydrogen hubNew York's climate plans require clarificationThis article outlines pertinent legal and policy climate change developments in the United States during the past week.(1)Biden's State of the Union reasserts climate goals On 7 February 2023, President Biden delivered the State of the Union and outlined his intentions for the United States' energy transition, noting: "The climate crisis doesn't care if you're in a red or a blue state. It's an existential threat." Experts have noted that the following are necessary to meet the president's ambitious climate change goals:an expedited power grid buildout;rapid approval of public lands and waters projects; andlegislation to reform the permitting process.Environmental Protection Agency refinery exemptions denial is not subject to Congressional Review ActThe Government Accountability Office determined that the Environmental Protection Agency's denial of exemptions for small refineries under the Renewable Fuel Standard in 2022 does not constitute a rule and, therefore, is not subject to the Congressional Review Act. The Renewable Fuel Standard aims to reduce greenhouse gas emissions by requiring the blending of biofuel into gasoline and diesel.Energy companies argue about definition of "green hydrogen"Some of the largest energy companies are arguing with renewable energy companies over what qualifies as "green energy" to receive Inflation Reduction Act tax credits. The eligibility rules for the hydrogen tax credits included in the Inflation Reduction Act are being drafted by the Internal Revenue Service (IRS) and the Treasury Department and are expected to be finalised in the coming months. As many proposed clean hydrogen projects utilise electrolysers, which consume large quantities of energy, clean energy firms are calling on the IRS to require companies to prove they are using green power.Senate bill to reallocate $11 billion worth of investments in fossil fuel companies California Senator Lena Gonzalez introduced Senate Bill 252 to reallocate the state's $11 billion worth of investments in fossil fuel companies toward catalysing the deployment of renewable energy. The bill would compel the California Public Employees' Retirement System to cease investments in fossil fuel companies and divest all their holdings in the largest 200 companies by 2030. California has pledged to be carbon neutral by 2045.Vermont joins multi-state effort to create clean hydrogen hubVermont recently joined a multi-state agreement along with New York, Connecticut, Maine, Massachusetts, New Jersey and Rhode Island to draft a proposal for the Bipartisan Infrastructure Law's Regional Clean Hydrogen Hubs programme. Governor Kathy Hochul said that Vermont's accession to the agreement "will advance our collective emissions reduction and climate goals because like our joint effort, air has no borders".New York's climate plans require clarificationAlthough Democrats control the gubernatorial and legislative arenas, New York is entering a period of uncertainty as it implements the Climate Leadership and Community Protection Law. While Governor Hochul and the state's climate action council have endorsed a cap-and-trade programme, the details involved in rolling out this concept – such as a cap threshold, initial price charges, exemptions and where the money is allocated – are unclear.For further information on this topic please contact Kenneth J Markowitz, Stacey H Mitchell, Dario J Frommer or Christopher A Treanor at Akin Gump Strauss Hauer & Feld LLP by telephone (+1 202 887 4000) or email ([email protected], [email protected], [email protected] or [email protected]). The Akin Gump Strauss Hauer & Feld LLP website can be accessed at www.akingump.com.Leila Fleming, public policy specialist, assisted with the preparation of this article.Endnotes(1) For further updates, including upcoming congressional hearings, federal agency climate news and events, click here. For the previous week's update, click here.