Wang Xiaoting, an analyst with BloombergNEF, believes China is likely to become a major market for hydrogen and Sinopec has the most ambitious target among the three national oil giants.
"In China, large firms are investing in hydrogen to demonstrate alignment with the government's carbon neutrality target and government funding is also on the rise," Wang said.
Sinopec is the largest producer of gray hydrogen in the country today and plans to commission 510 megawatts of green hydrogen production capacity in 2022 based on two projects in Inner Mongolia and Xinjiang, compared with only 200 MW of electrolyzers being shipped globally last year, she said.
According to the Hydrogen Industrial Technology Innovation Alliance of China, the country's hydrogen energy industry output value will reach 1 trillion yuan ($150 billion) by 2025, while demand for hydrogen will approach 60 million tons by 2050.
The alliance expects hydrogen will account for more than 10 percent of the country's terminal energy mix and become a new growth pillar of the economy, with annual output value of the industrial chain exceeding 12 trillion yuan by 2050 as policies and projects around the world involving the clean fuel have been expanding rapidly since 2018.
The Chinese government has rolled out a series of measures to boost the industry's development in recent years.
Hydrogen power was first written into China's Government Work Report in 2019, which stated that the government will promote the construction of charging and hydrogen refueling facilities. It was followed by a General Office of the State Council document last year that called for stepped-up efforts in research and development of technologies related to hydrogen storage, refueling, cost reduction and security.
By the end of 2020, China had 128 hydrogen refueling stations and more than 7,000 hydrogen vehicles on its roads, said the Hydrogen Council, a global initiative of leading energy, transport and industrial companies.
Experts believe it is time to tap into hydrogen's potential, including in long-haul transport and the production of chemicals, iron and steel, to allow it to play a key role in China's clean and safe energy mix.
Luo Zuoxian, head of intelligence and research at the Sinopec Economics and Development Research Institute, believes the government will come up with a more detailed hydrogen energy industry development plan that covers hydrogen production, transportation and consumption.
As climate change impacts our lives more than ever, hydrogen energy－a light, storable and transportable gas which produces no emissions when made with renewable energy－is expected to play a vital role in the transition to carbon-free societies, Luo said.
