Committee reviews Advanced Clean Manufacturing Tax Credit to attract clean‑tech production and reduce industrial emissions

The House Finance Committee held an informational hearing on House Bill 15‑56, the Advanced Clean Manufacturing Tax Credit, which its sponsor, Representative Elizabeth Fiedler, described as legislation to support advanced materials and low‑carbon manufacturing in Pennsylvania.

Fiedler told the committee the bill seeks to help Pennsylvania manufacturers “adapt to new technologies” and to attract “new businesses and new jobs to the Commonwealth.” She framed the proposal as building on the state’s industrial heritage and said the committee could refine the bill to ensure it meets economic and environmental goals.

Technical witnesses urged the committee to design the credit to leverage private investment while protecting taxpayers. Hannah Thonet, manager of state industry policy for RMI (Rocky Mountain Institute), said HB 15‑56 “allows for $50,000,000 to be given in credits per year with a $25,000,000 cap per project.” Thonet and other witnesses recommended performance metrics, clawback provisions and clearer definitions of qualifying “clean” production and electricity additionality to avoid subsidizing incumbent high‑emitting processes.

Joshua Ash, director of the Environmental Law and Policy Clinic at the University of Pittsburgh School of Law, testified to the economic rationale for the credit and described state support as a way to bridge supply and demand for nascent clean production methods. Ash said policymakers should view incentives as a tool to “bring these producers that are trying to do these green innovative clean things over that hump of supply and demand,” and warned that different sectors (cement, aluminum, steel, glass) have distinct cost and timeline profiles.

Hillary Lewis, steel director at Industrious Labs, emphasized local health and economic stakes. Lewis said, “In Pennsylvania, the share [of emissions from industry] is even higher, almost a third of emissions,” and argued the credit could protect family‑sustaining jobs while reducing pollution. She and other witnesses noted the federal and state landscape of complementary programs — for example, RISE PA and federal production tax incentives such as those created under the Inflation Reduction Act — and suggested the state credit be sized and structured to attract private follow‑on capital.

Committee members asked about program size, eligible projects and whether the proposed cap and percentage were sufficient for large industrial transformations. Chairman Samuelson summarized bill language in the committee packet and noted alternative numerical formulations discussed during testimony: at one point witnesses and staff referenced a $50 million annual cap with project caps (per RMI testimony), while the committee analyst’s packet discussed a structure of up to 30% of qualified production costs with a $10 million maximum per facility and a $50 million annual cap that would expire in 2035. Witnesses said the program as written could catalyze mid‑scale projects and equipment manufacturing, but that projects such as converting a coal‑based blast furnace to hydrogen direct reduced iron could require substantially more capital than a single state credit could cover.

Debate included free‑market concerns and responses from witnesses. Representative Kephart questioned whether such incentives amounted to “central planning” and cited historical examples of failed government‑backed firms; witnesses pushed back that modest, competitive incentives paired with workforce training and renewable electricity policies are standard industrial policy tools to catalyze otherwise underfunded innovation.

Next steps and follow‑up: Representative Fiedler said she is open to modifications including clawback provisions and wraparound workforce and renewable‑energy measures. No formal vote was taken during the informational hearing; the committee will accept written testimony and work with the sponsor on amendments in the coming weeks.