Mar 29, 2023
Nikola Eyes Lucrative Hydrogen Fuel Credits From Government Incentives
(Bloomberg) -- If electric-vehicle company Nikola Corp. can get its hydrogen fuel cell trucks and filling station network in operation, the company could pull in hundreds of millions a year from incentives in the Biden administration’s Inflation Reduction Act.
Key among them is an incentive for as much as $3 per kilogram of hydrogen produced. If Nikola hits its goal of producing 300,000 kilograms of hydrogen per day, the company could bank close to $1 million a day from the Federal Government. California offers another $1 to $2 per kilogram for dispensing hydrogen. Parts of the IRA, including incentives for hydrogen vehicles, are still being finalized.
“IRA is huge for us,” Nikola Chief Executive Officer Michael Lohscheller said in an interview. “We want to build the entire hydrogen ecosystem. For us, the hydrogen piece is the most attractive.”
That’s saying something because the incentives for hydrogen trucks are also huge. The current draft of the IRA would give $40,000 per hydrogen-powered truck sold. California adds an additional $288,000 per truck sold, which gets the cost of Nikola’s trucks near parity with diesel vehicles, Lohscheller said.
The company currently produces one electric model of its semitruck, the Tre BEV, and is on target to start building its hydrogen-powered trucks in the second half of this year, Lohscheller said. But building a market won’t be easy. Buyers need hydrogen to keep the trucks running and that requires new infrastructure and permitting in some cases.
EV companies like Nikola have also had a tough time hitting production and sales goals. Nikola made 258 of its planned 300 electric semitrucks last year.
Nikola went public in June 2020 through a reverse-merger, and shares have since fallen below their initial listing price. The company’s stock has fallen 31% so far this year.
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