Bill > HB0161

This bill establishes a new severance tax framework for hydrogen production in Wyoming, creating a comprehensive taxation approach for this emerging energy resource. The bill defines hydrogen production as the separation of hydrogen from water extracted from the ground and imposes a severance tax on the gross value of hydrogen produced in the state. The tax rates vary based on the source of hydrogen: a 3% tax rate applies to hydrogen produced from by-product water, while all other hydrogen production is subject to a 6% tax rate. The bill adopts existing natural gas taxation procedures for valuing, assessing, and collecting the tax, and specifies that any person engaged in hydrogen production or owning an interest in hydrogen production is liable for the tax. Taxpayers will benefit from existing natural gas exemptions, and the tax will be administered by the state department following established severance tax collection and enforcement procedures. The tax will become applicable to hydrogen production on or after July 1, 2025, providing clarity and predictability for potential hydrogen producers in the state. Severance tax revenues generated from hydrogen production will be distributed according to existing state regulations, integrating this new energy source into Wyoming's existing tax revenue framework.

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https://www.wyoleg.gov/Legislation/2025/HB0161