Expanding the use of “green hydrogen” would be critical for China to meet its dual carbon targets, analysts believe, as future increase in power generation will largely come from non-fossil sources.

The National Development and Reform Commission and the National Energy Administration jointly released a 15-year plan to grow the hydrogen energy industry and increase the share of renewable energy in hydrogen energy.

The country generated over 33 million tons of hydrogen last year, making it the top producer on a global scale, and production is predicted to reach 43 million tons by 2030.

According to the China Hydrogen Alliance, green hydrogen will expand its share of the energy mix from 1% in 2019 to 10% in 2030, while the market scale will nearly triple.

Hydrogen produced mostly from natural gas – the present mainstream – generates huge amounts of carbon dioxide and is referred to as “gray hydrogen.”

Carbon emissions from blue hydrogen are caught and saved, or repurposed, whereas green hydrogen is manufactured using renewable energy sources without emitting carbon dioxide.

Companies around the country, both private and state-owned, have all put out plans to capture a piece of China’s green hydrogen market, either by leveraging their geographic advantages or by developing new industrial parks to build solar or wind power to generate green hydrogen.

Sinopec, or China Petroleum and Chemical Corp, the world’s largest refiner by volume, has already proposed four green hydrogen projects. These investments are part of a US$4.6 billion (RM19.95 billion) investment strategy in the sector through 2025, with the goal of increasing its annual hydrogen production capacity to 500,000 tonnes.