The United States has been investing in hydrogen energy since the 1950s. The investment record is long, the policy history is discontinuous, and the commercial outcome is modest. The GAO’s April 2026 technology assessment traces that history and draws a pointed conclusion: policy stability matters, and the current environment lacks it.
A Century of Starts and Stops
Congressional support for hydrogen energy has been periodic rather than sustained. Key legislative moments include a 1976 authorization of $30 million through the Electric and Hybrid Vehicle Research, Development, and Demonstration Act; a $20 million authorization in 1990 through the Spark M. Matsunaga Hydrogen Research, Development, and Demonstration Act; a $214.5 million authorization in 1996 through the Hydrogen Future Act; and nearly $2 billion authorized through the Energy Policy Act of 2005 for hydrogen production, storage, distribution, and fuel cell technology projects.
In 2009, Congress cut nearly 60 percent of the Fuel Cell Technologies program budget — $100 million — in a single appropriations cycle. In 2022, the Inflation Reduction Act provided a clean hydrogen production tax credit of up to $3 per kilogram for qualified facilities constructed through 2032. In 2025, the One Big Beautiful Bill Act moved the deadline for eligible construction to the end of 2027, effectively cutting five years from the credit’s availability window and creating immediate uncertainty for projects that had been planned around the longer horizon.
The pattern is legible: investment phases followed by budget contractions, policy incentives created and then truncated, long-term industrial planning disrupted by short-term political cycles. The GAO’s parallel to natural gas is instructive. Natural gas took roughly a century to develop from a local heating fuel to the backbone of U.S. energy supply — and it did so because the economics eventually became favorable without ongoing policy support. Hydrogen has not achieved that cost crossover, and without it, policy consistency matters more.
The 2025 Policy Shift
The 2025 policy shifts were significant in both scale and signal. The Department of Energy terminated more than 220 energy projects, saving over $7.5 billion according to the agency’s own account. A substantial number of those were clean hydrogen development grants. The truncation of the hydrogen production tax credit timeline, combined with the grant terminations, sent a clear message to the industry: the investment framework that had been established under the Inflation Reduction Act was not guaranteed.
The consequences, according to stakeholders interviewed by GAO, were concrete. Companies with active hydrogen energy investments expressed concern about policy reversals. Some projects were terminated. Some companies moved operations or announced intentions to relocate to foreign markets with more stable policy environments. A nonpartisan energy-focused organization told GAO directly that policy instability was keeping hydrogen prices high by preventing the infrastructure investment needed to achieve economies of scale.
Five Policy Goals, Seven Options
The GAO report identifies five policy goals derived from historical congressional legislation: energy security and resilience, U.S. hydrogen market competitiveness, low-carbon energy transition, prioritizing technologies with near-term potential, and research, development, and innovation. For each goal, it offers policy options — not recommendations — spanning seven categories: identifying vulnerabilities and deploying solutions, addressing infrastructure needs, clarifying regulations and standards, supporting R&D, implementing market-stimulating mechanisms, evaluating deployment and utility, and facilitating collaboration and consortia.
The options are framed without prescription by design. The GAO’s role in technology assessments is to provide Congress with a structured analytical basis for decision-making, not to direct policy. But the underlying message is consistent: hydrogen energy development requires sustained, coherent policy over long timeframes if it is to achieve commercial scale. Short-term incentive programs, frequently modified, produce neither the infrastructure investment nor the industrial commitment that large-scale energy transitions require.
The Competition Dimension
The GAO report raises U.S. market competitiveness as a distinct policy concern. Global hydrogen demand grew approximately 2 percent annually between 2022 and 2024, reaching roughly 100 million metric tons. Countries and trading blocs with stable, long-term hydrogen policy frameworks — including the European Union, Japan, South Korea, and Australia — are building industrial capacity that will shape global market positions for decades. China is a direct competitor in electrolyzer manufacturing, a sector that could become a significant export industry for whoever achieves cost leadership.
If U.S. policy instability causes domestic hydrogen technology companies to exit the market or relocate development activities abroad, the loss is not merely in domestic energy policy terms — it is a loss of industrial capacity in a sector that multiple major economies are treating as strategically important. The GAO report does not make that argument explicitly, but the evidence it presents supports it. What the U.S. builds or fails to build in hydrogen technology over the next decade will have consequences that extend well beyond electricity generation or vehicle fueling.