Guest article by Teresa Cooke, Legislative and Regulatory Policy Advisor for H2FCP
California's 2025 legislative session concluded on Saturday, September 13th. More than 2,300 bills were introduced, and 1,426 were ultimately sent to the Governor for signature.
Unfortunately, SB 419 (Caballero), an industry-sponsored bill that would have eliminated the state’s sales and use tax on hydrogen fuel to create greater parity across alternative fuel taxes, was vetoed by Governor Newsom on budgetary concerns.
Other hydrogen-related bills that stalled:
- AB 716 (Carrillo), which would have allowed local governments to adopt more stringent fire safety standards on hydrogen infrastructure.
- SB 804 (Archuleta), which was related to dedicated hydrogen pipeline standards. SB 804 is likely to resurface in 2026.
While we were unable to make significant legislative gains in 2025, the industry worked tirelessly to defeat numerous attacks on the Low Carbon Fuel Standard (LCFS) throughout session. We are pleased to report that, ultimately, legislative support for the program increased.
On the LCFS front, the November 2024 amendments (finally!) went into effect on July 1, 2025, to maximize the program’s benefits for light through heavy-duty hydrogen fueling infrastructure.
On the budgetary front, $132 million was allocated toward the Hybrid and Zero-Emission Truck and Bus Voucher Incentive Project (the application window closed on October 3rd), and an additional $40 million was allocated to the California Energy Commission (CEC) for charging and hydrogen infrastructure development.
News of the Department of Energy defunding ARCHES spread quickly around the Capitol. We expect the Senate Select Committee on Hydrogen Energy to hold an informational hearing on California’s response in late October. Ongoing budgetary challenges will limit what lawmakers can do in 2026, and there are numerous policy opportunities we are socializing over the interim.
On the regulatory front, we anticipate $30-$40 million in additional funding from the CEC for hydrogen fueling infrastructure. Additionally, from the CEC, we look forward to its report on alternative funding methodologies and potential fee structures for zero-emission vehicle infrastructure, which is due to the legislature by January 1, 2026.
