At the heart of the tension lies the bloc’s approach to technology neutrality. While the U.S. Inflation Reduction Act (IRA) allocates tax credits across multiple hydrogen production pathways—including $3/kg for low-carbon methods like methane pyrolysis—EU policies remain disproportionately focused on electrolysis-derived “green” hydrogen. This narrow focus risks sidelining alternative methods, such as methane splitting with solid carbon capture, which could reduce emissions by 92% compared to conventional steam methane reforming (SMR), according to 2023 lifecycle analyses by the International Energy Agency (IEA).
