MERICS CHINA MONITORJune 28, 2022CHINA’S NASCENT GREEN HYDROGEN SECTOR: How policy, research and business are forging a new industryAlexander Brown, Nis Grünberg| 2MERICS CHINA MONITOR | June 28, 2022KEY FINDINGS China regards hydrogen as a strategic “frontier technology” in which it aims to become a global leader. Its policy focus in the short term will be on general industry development first, greening second. China is poised to rapidly expand its green hydrogen industry within the next decade. Government mandates to decarbonize, along with the lure of growing demand for carbon-neutral hydrogen and associated equipment is spurring on related R&D and business ventures. Local policy and industry developments are already moving far beyond the national strategy and its conservative targets, building momentum for the green hydrogen industry. China’s push into green hydrogen will be characterized by strong state-led support for market creation and technology at each stage of the value chain. State-owned enterprises and public-funded R&D centers are rushing to develop hydrogen technolo-gies with the expectation of a massive ramping up of the industry. Driven by bullish forecasts for future demand in low-carbon hydrogen, private enterprise is also contributing to the rapid capacity expansion in green hydrogen pro-duction equipment. Europe’s leadership in green hydrogen technology will shrink as China deepens its innovation capacities and strengthens its price competitiveness. The country already accounts for a third of global electrolyzer manufacturing capacity and will become more competitive as it scales up production. Despite a surge in resources dedicated to hydrogen R&D, China remains behind Europe, the United...
