China Unveils 2025 Green Hydrogen Target with Goal of Widespread Adoption

China's top economic planner announced a target of producing up to 200,000 tonnes per year of green hydrogen, a zero-carbon fuel derived from renewable energy sources, by 2025, but envisions a more widespread industry in the long term.

The National Development and Reform Commission (NDRC) stated in a statement that the country aims to produce 100,000 tonnes to 200,000 tonnes of green hydrogen per year and have approximately 50,000 hydrogen-powered vehicles by 2025.

China, the world's largest emitter of greenhouse gases, has been attempting to strike a balance between energy security and climate change goals and is focusing on hydrogen to reduce carbon emissions from its transportation and industrial sectors.

About Green Hydrogen:

Green hydrogen is a gas produced by the electrolysis of water using renewable energy sources, which reduces the number of carbon emissions released during the process when compared to hydrogen produced from natural gas or coal.

"The development of hydrogen is an important step toward energy transition and a significant support for China's carbon peak and carbon neutrality goals," said Wang Xiang, deputy director of the NDRC's High Technology Department, at a press conference.

According to the government, China currently produces 33 million tonnes of hydrogen per year, with approximately 80 percent of hydrogen derived from coal and natural gas and the remainder primarily a byproduct of industrial sectors.

According to data from the China Hydrogen Alliance, an industrial association, China produced 500,000 tonnes of hydrogen from water electrolysis in 2019. Wang stated that, while the majority of China's hydrogen is produced using fossil fuels, the potential for green hydrogen is enormous because China has the world's largest renewable power capacity.

As per the NDRC statement, China aims to establish a complete hydrogen industry covering transportation, energy storage, and industrial sectors by 2035, as well as "significantly improve" the proportion of green hydrogen in China's energy consumption.

According to the China Hydrogen Alliance, China's hydrogen demand will rise to 35 million tonnes per year by 2030, up from 20 million tonnes now, and will reach 60 million tonnes by 2050.

Hydrogen is a fuel that can be used in both fuel cells and internal combustion engines. One of the major impediments to hydrogen development is high production costs. Analysts predict that hydrogen prices will rise. To compete with gasoline and diesel, costs must be cut in half.

"Local governments will be strictly prohibited from blindly following the trend of hydrogen project construction and will be prohibited from building low-end projects to avoid resource waste," Wang said. Almost all Chinese provinces and regions have included hydrogen in their development plans.

Some major Chinese energy, auto, and metallurgy companies, such as Sinopec, Baosteel, and GCL, have expanded their businesses to include hydrogen production, the use of natural gas and renewable energy, the construction of hydrogen filling stations, and the use of hydrogen in steelmaking and transportation.