The Hydrogen Strategy of China

The hydrogen strategy of China

Investing in hydrogen, a renewable and possibly clean source of energy has increased in China. China invests heavily in its hydrogen strategy. The nation’s central and local governments have included the hydrogen sector as one of China’s six future industries in the 14th Five-Year Plan (2021-2025).

Hydrogen and China

The country’s hydrogen energy industry is expected to generate 1 trillion yuan ($152.6 billion) in output by 2025, according to the China Hydrogen Alliance. By 2030, China’s demand for hydrogen will reach 35 million tons. This will make up at least 5% of the country’s energy system. Chinese authorities unveiled a plan for the development of hydrogen energy for the years 2021 to 2035 on March 23. The nation rushes to meet its targets for carbon peaking and neutrality. According to the plan jointly released by the National Development and Reform Commission and the National Energy Administration, China will set up a relatively complete hydrogen energy industry development system by 2025, with the innovation capability significantly improved and the core technologies and manufacturing processes essentially mastered.

The 2025 milestone

By 2025, it is anticipated that annual hydrogen generation from renewable energy would reach 100,000 to 200,000 tonnes. It aims to play a significant role in the consumption of new hydrogen energy, and enable a reduction of one million to two million tonnes of carbon dioxide emissions. The long-term strategy is built upon the visions and goals for hydrogen that have appeared in recent papers. Such as the 14th Five-Year Plan (2021–2025), where hydrogen is referred to as a “frontier” region. It is one of the six industries that will be given special attention. In order to assist satisfy its energy needs and decarbonize its economy, China is rapidly promoting the development and consumption of lower-emission hydrogen.

A significant milestone in China’s pursuit of its climate goals is the country’s push for clean hydrogen. With a capacity of 33 million tons (Mt), China is currently the world’s greatest producer of hydrogen, with the majority of its output coming from the use of fossil fuels as feedstocks in chemical or refinery operations. According to the China Hydrogen Alliance, China’s hydrogen demand is expected to increase to 35 Mt in 2030 (at least 5% of the country’s energy supply) and 60 Mt in 2050. (10 percent).

Meanwhile, China would manufacture 100,000 to 200,000 tons of renewable hydrogen annually. In addition, has a fleet of 50,000 hydrogen-fueled vehicles by 2025, according to the most recent government plan. China is currently the world’s leading market for fuel cell trucks and buses. In addition, the third-largest market for fuel cell electric vehicles (FCEVs). China’s carbon emissions could be reduced by producing hydrogen from low-carbon sources and employing clean hydrogen in a variety of industrial sectors.

What are China’s policy positions on the production of hydrogen?

In its 14th Five Year Plan, China declares hydrogen to be a “frontier” field that it will advance. 16 provinces and cities have created their own five-year plans that notably mention hydrogen, despite the lack of a national strategy for the development of hydrogen. For instance, Beijing has advanced the planning and development of hydrogen refueling stations. The strategy for Jiangsu Province calls for infrastructure for hydrogen fuelling and the development of hydrogen fuel cell automobiles. A four-year program is being launched by China to assist local governments in researching hydrogen technologies and creating an industry chain.

Participants informed Caixin that five city groups, including the Beijing-Tianjin-Hebei cluster, the provinces of Guangdong and Henan, and Shanghai, had been chosen for demonstration projects. The identities of the participating cities have not yet been made public by the national government. Local governments would receive a fiscal bonus of up to 1.7 billion yuan if they reach a particular goal. According to participants, five ministries—including the Finance Ministry, the Ministry of Industry and Information, and the National Energy Administration—delayed the release of the final list since the review procedure has stringent requirements and there is heated competition among provinces.

Numerous state-owned businesses (SOEs) have been investing in hydrogen projects despite the lack of a national policy, and several subnational governments have developed hydrogen development plans or highlighted hydrogen as a top economic priority. It is unknown how many of these SOE initiatives will be profitable in the long run or whether many of the subnational plans will be consistent with how the national planners intend to develop the hydrogen economy of the nation.

The strategy of China about hydrogen
China is the global leader in the hydrogen race.

Road maps for hydrogen have been created by more than 30 nations. The United States is at the forefront of lab research. Japan is at the forefront of hydrogen fuel cell technology. According to Wang Cheng, director of the hydrogen fuel cell laboratory at Tsinghua University, China has the largest hydrogen market whereas Europe is more focused on upstream hydrogen generation. Research and innovation are in the spotlight of the Chinese government regarding technologies related to hydrogen. The emphasis reflects the nation’s goal to fill the knowledge, experience, and infrastructural gaps in the existing low-carbon hydrogen production. For instance, alkaline electrolysis technology is well-established and affordable. Regardless is less compatible with intermittent renewable energy sources than polymer electrolyte membrane electrolyzers, which is where China currently finds competition. Alkaline electrolyzers dominate the Chinese market, where PEM electrolyzers only make up less than 10% of the total.

Manufacturing capacity is a further area of attention for China’s long-term strategy. China possessed 8% of the world’s electrolyzer stock as of 2020. In addition, 35% of the world’s manufacturing capacity is for electrolyzer machinery and parts. To satisfy both domestic and international markets, Chinese enterprises want to increase their electrolyzer manufacturing capacity.


There are numerous consequences for China’s economy as well as the trajectory of the growth of the hydrogen sector globally. It is important to pay close attention to the direction, pace, and scale of China’s low-carbon hydrogen undertakings.

Written by our Energy Enthusiast
Pavlos Hitiris

Pavlos Hitiris Author

Pavlos has a Bachelor in International and European Studies from the Panteion University of Athens. He has worked successfully at a Law Firm in Kolonaki, Athens. Currently, he is working at a Solution Provider/System Integrator Company in Athens. Postgraduate student of the MSc in Energy: Strategy, Law, and Economics at the University of Piraeus in the faculty of International and European Studies. He speaks Greek, English, and German. Keen on Middle East culture and history.

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