11 Nov 21

China’s Hydrogen Intentions

A remarkable item in China’s 14th Five Year Plan (2021 – 2025) is the confirmation of hydrogen industry as one of China’s 6 industries of the future. The country is serious about its Plans – electrification was one of the major items in the “Made in China 2025” plan and has led to China becoming a global EV leader, both in manufacturing and consumer uptake.


China’s interest in hydrogen technology comes from the country’s pledge to become carbon-neutral by 2060 and hit peak carbon emissions before 2030. In addition, China depends on other countries for its oil needs and is keen to improve its position. By 2030, the country’s need for hydrogen is predicted to reach 35 million tons, or 5% of the China’s energy system


On top of a a country-wide development and incentivation plan for the hydrogen industry, 16 provinces have included hydrogen in their own 5-year plans. The country supports local governments with fiscal bonuses in their R&D efforts as well as in developing a supply chain.


The bottom line is that hydrogen is expensive and not clean. Currently, the cost of one kg of hydrogen to power a fuel cell car is roughly USD 10 – too expensive to be economically sustainable. Here are the main challenges to produce hydrogen:

Hydrogen can be extracted from fossil fuel, but that doesn’t make much sense. The alternative production method is water electrolysis whereby electricity is used to split the “H” from the “O”. Unfortunately, this procedure is costly as well; it requires expensive equipment and USD 6 worth of electricity for the production of 1 kg.

In China, that electricity comes from coal; one kg of hydrogen would produce over 35 kg of carbon dioxide, which means that hydrogen is about 4 times as polluting as fossil fuel.

Therefore, China is not looking at “normal” hydrogen, but at “green” hydrogen instead. In other words, the electricity required to produce hydrogen needs to come from renewable energy (hydro, wind, solar), hence additional investments are being made to build renewable power plants.

Finally, transportation of hydrogen is costly, polluting, and time-consuming, hence the need for a delivery infrastructure via pipelines. Pipeline research and investments are consequently also captured in the 14th Five-Year Plan.

Becoming the leader

At this point in time, Japan leads the race to hydrogen. Toyota sells about 10.000 units of its Mirai and has been investing massively in R&D. As a country however, Japan is not ready for a massive implementation of hydrogen as there are only 135 hydrogen fuel stations nationwide and no concrete plans to expand. Although the Japanese government is pushing automakers and energy companies to invest collaboratively in hydrogen, only few companies are willing to sacrifice budget for long-term goals.

This is where China will do better than Japan; many Chinese companies are already collaborating with Japanese companies and collect knowledge, whilst a country-wide strategy is much easier to implement in China, due to the country’s planned economy. One thing is sure: China has put its mind to hydrogen the same way it had put its mind to electrification and failure is not on the agenda.

Picture Credit: Shutterstock

Authored by: Yves Helven