Document ID: chunk:federal_register_of_legislation:C2025A00009:clause:1_3:p1
Version: federal_register_of_legislation:C2025A00009
Segment Type: clause
Provision Reference: sch 1 cl 3 (pt 1/14)
Character Range: 6282–9118

3  At the end of Part 3‑50
Add:

Division 421—Hydrogen production tax incentive

Table of Subdivisions
 Guide to Division 421
421‑A Tax offset for hydrogen produced in Australia
421‑B Certification of production profiles
421‑C Other matters

Guide to Division 421

421‑1  What this Division is about

      A company may be entitled to a refundable tax offset in respect of hydrogen produced in Australia between the start of 1 July 2027 and the end of 30 June 2040.
      One requirement for entitlement to the offset is that the company must have created a certificate (called a PGO certificate) that relates to the hydrogen. The certificate is created under the Future Made in Australia (Guarantee of Origin) Act 2024 and it must be registered under that Act.
      Another requirement is that the facility at which the hydrogen is produced, and the production pathway for the hydrogen, must be specified in a production profile that is certified by the Clean Energy Regulator under this Division. The hydrogen must also have been produced during a particular period (which is called an offset period, and which cannot be longer than 10 years) that is associated with production at the facility in accordance with the production pathway.
      The amount of the tax offset is $2 per whole kilogram of hydrogen (though this may be reduced in certain circumstances).

Subdivision 421‑A—Tax offset for hydrogen produced in Australia

Table of sections
421‑5 Company entitled to refundable tax offset for hydrogen produced in Australia
421‑10 Amount of hydrogen production tax offset
421‑15 When hydrogen is produced
421‑20 Production emissions intensity
421‑25 Grid matching requirements
421‑30 Offset period
421‑35 Initial reconciliation period for registered PGO certificate
421‑40 Correction notice for registered PGO certificate
421‑45 HPTO community benefit rules

421‑5  Company entitled to refundable tax offset for hydrogen produced in Australia
 (1) A company is entitled to a *tax offset under this section (the hydrogen production tax offset) for an income year in respect of a kilogram of hydrogen produced in Australia during the income year if:
 (a) the income year:
 (i) starts on or after 1 July 2027; and
 (ii) ends before 1 July 2040; and
 (b) there is a *registered PGO certificate that relates to the kilogram of hydrogen and which states:
 (i) that the kilogram of hydrogen was produced at a particular facility that is specified in a *production profile, in accordance with a particular *production pathway that is specified in that production profile; and
 (ii) that the kilogram of hydrogen has a *production emissions intensity that is less than or equal to 0.6 kilograms of carbon dioxide per 1 kilogram of hydrogen (see section 421‑20); and
 (iii) if the facility is connected to an electricity grid—that the