It makes no sense to make green hydrogen when (1) natural gas is still allowed to be burned directly, and (2) gray hydrogen from SMR of natural gas has no CO2 tax.

This doesn't mean green hydrogen can't work, any more than the large amount of local air pollution before the passage of the Clean Air Act meant air pollution was impossible to control. It's just a matter of making fossil fuel users fully pay for the externalities they impose on others.