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HB0161 • 2025

Hydrogen severance tax.

AN ACT relating to mine product taxes; providing for the taxation of certain hydrogen production; specifying tax rates for different types of hydrogen production; providing for the administration of the tax; specifying applicability; and providing for an effective date.

Energy Taxes
Inactive

Wyoming marks this bill as inactive, which usually means it is no longer moving in the current session.

Sponsor
Representative Tarver
Last action
2025-03-03
Official status
inactive
Effective date
3/1/2025

Plain English Breakdown

The bill was marked inactive and did not pass.

Hydrogen Severance Tax

The bill proposes a new tax on hydrogen production in Wyoming and sets different rates based on the source of water used to produce hydrogen.

What This Bill Does

  • Creates a severance tax for hydrogen produced from underground water sources.
  • Sets a tax rate of 3% for hydrogen made using by-product water and 6% for all other types of hydrogen production.
  • Requires the state department to assess and value hydrogen production annually based on fair market value.

Who It Names or Affects

  • Companies that produce hydrogen from underground water sources in Wyoming.

Terms To Know

Severance Tax
A tax on the removal or extraction of natural resources, like oil and gas, from a state's land.
By-Product Water
Water that is produced as a result of extracting other substances, such as oil or gas, rather than being the main product itself.

Limits and Unknowns

  • The bill did not pass and was marked inactive by Wyoming's legislature.
  • It only applies to hydrogen production from underground water sources in Wyoming starting July 1, 2025.

Bill History

  1. 2025-03-03 House

    H:Died in Committee Returned Bill Pursuant to HR 5-4

  2. 2025-02-07 House

    H No report prior to CoW Cutoff

  3. 2025-01-20 House

    H Introduced and Referred to H09 - Minerals

  4. 2025-01-14 House

    H Received for Introduction

  5. 2025-01-13 LSO

    Bill Number Assigned

Current Bill Text

Read the full stored bill text 
25LSO-0634
2025
STATE OF WYOMING
25LSO-0634
Introduced
2.0

HOUSE BILL NO. HB0161

Hydrogen severance tax.

Sponsored by: Representative(s) Tarver, Clouston, Davis, Larson, JT and Lawley and Senator(s) Barlow and Boner

A BILL

for

AN ACT relating to mine product taxes; providing for the taxation of certain hydrogen production; specifying tax rates for different types of hydrogen production; providing for the administration of the tax; specifying applicability; and providing for an effective date.

Be It Enacted by the Legislature of the State of Wyoming:

Section 1.

W.S. 39
‑
14
‑
213 is created to read:

39
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14
‑
213.

Taxation of certain hydrogen production.

(a)

As used in this section:

(i)

"Hydrogen" means hydrogen subject to taxation pursuant to the provisions of this section;

(ii)

"Hydrogen production" means the separation of hydrogen from water that is produced from the ground;

(iii)

All other definitions in W.S. 39
‑
14
‑
201 are incorporated herein by reference to the extent that they may apply.

(b)

Administration; confidentiality:

The department shall annually value and assess hydrogen production at its fair market value for taxation in accordance with the applicable provisions of W.S. 39
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14
‑
202.

(c)

Taxable event:

There is levied a severance tax on the value of the gross product resulting from hydrogen production in this state. The tax imposed by this subsection shall be in addition to all other taxes imposed by law.

(d)

Basis of tax:

Hydrogen shall be valued for taxation as natural gas as provided in W.S. 39
‑
14
‑
203(b).

(e)

Taxpayer:

Any person engaging in hydrogen production; or, to the extent of his ownership interest, any person owning an interest in the hydrogen, is liable for the payment of the severance tax together with any penalties and interest.

Nothing in this subsection shall be deemed to require the tax to be paid more than one (1) time as provided in this section.

(f)

Tax rate:

Hydrogen resulting from hydrogen production shall be subject to the following severance tax rates:

(i)

Hydrogen produced from by
‑
product water as defined in W.S. 41
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3
‑
903 shall be subject to a severance tax rate of three percent (3%);

(ii)

All other hydrogen produced from water shall be subject to a severance tax rate of six percent (6%).

(g)

Exemptions:

The exemptions from taxation provided by W.S. 39
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14
‑
205 for natural gas shall apply to hydrogen under this section.

(h)

Compliance; collection procedures:

The severance tax related provisions of W.S. 39
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14
‑
207 shall apply to hydrogen production.

(j)

Enforcement:

All severance tax related provisions of W.S. 39
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14
‑
208 shall apply to hydrogen production.

(k)

Taxpayer remedies:

All severance tax related provisions of W.S. 39
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14
‑
209 shall apply to hydrogen production.

(m)

Distribution:

Severance tax revenues from hydrogen production shall be distributed as provided by W.S. 39
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14
‑
211.

Section 2
.

This act shall apply to any hydrogen production on or after July 1, 2025.

Section 3
.

This act is effective July 1, 2025
.

(END)

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HB0161