Center onOctober 2023Global Energy Policyat COLUMBIA SIPAChina's Hydrogen Strategy:National vs.Regional PlansBy Yushan Lou and Anne-Sophie CorbeauWhile the US and European medias have dedicated significant bandwidth to the topic of low-carbon hydrogen in the United States and Europe,they have reported far less on unfoldingdevelopments around that topic in China.This disparity is especially notable because Chinastands as the foremost global player in hydrogen production and consumption.The country'ssubstantial market size and extensive industrial infrastructure not only facilitate fast technologicaladvancements in the hydrogen space,but also offer the potential to achieve economies of scale-two developments that can significantly influence the global hydrogen market landscape.In lightof these circumstances,it is essential to understand China's hydrogen strategy,including how thecountry plans to start decarbonizing its current hydrogen consumption and expand future useand production.A notable feature of China's hydrogen strategy is that it is not,in fact,singular,but insteadcomprised of a national strategy and a multitude of regional strategies.Since the release ofChina's Medium and Long-Term Strategy for the Development of the Hydrogen Energy Industry(2021-2035)(referred to as "the National Plan)in March 2022,2 there has been significantdevelopment in the country's hydrogen space.However,the National Plan's targets for renewablehydrogen production may appear conservative given the scale of hydrogen consumption in thecountry:a range of 100,000 to 200,000 tons per year by 2025 represents only 0.3 to 0.6 percentof the 33 million tons(Mt)of fossil-based hydrogen consumed in China in 2020.3(For context,in2022,electrolytic hydrogen's production level was still below 100,000 tons globally,and as of early2023 about 4.5 Mt of renewable hydrogen globally by 2025 has been committed to,planned,andThis commentary represents the research and views of the authors.It does not necessarilyrepresent the views of the Center on Global Energy Policy.The piece may be subject tofurther revision.Contributions to SIPA for the benefit of CGEP are general use gifts,which gives the Centerdiscretion in how it allocates these funds.More information is available at www.energypolicy.columbia.edu/about/partners.Rare cases of sponsored projects are clearly indicated.energypolicy.columbia.edu|1October 2023announced.+Some regions appear more bullish,including the EU with its aspirational renewablehydrogen target of up to 1 Mt by 2024.5)By contrast,provinces,cities,and municipalities acrossChina have introduced their own hydrogen development plans that establish far more ambitiousrenewable hydrogen goals.Hence,the provincial plans viewed together may offer a more accuratepicture of China's hydrogen industry over the coming decades than the National Plan.This commentary analyzes these somewhat divergent national and local hydrogen strategiescomparatively to provide a nuanced understanding of China's evolving hydrogen landscape.Its keyfindings are as follows:The targets of China's provinces combined are far more ambitious than its national targets,with Inner Mongolia leading the way.The latter province is aiming to reach 480,000 tons ofrenewable hydrogen production per year by 2025(2.5 to 5 times the national target).Chinamay have set a conservative national renewable hydrogen target to test the waters,allowinglocal governments to charge ahead.●Inner Mongolia could reach around 60 percent of its 2025 target based on projects that arecurrently under construction (and excluding those still in the planning stage,which may ormay not materialize).This region alone would largely meet the national target for renewablehydrogen.While the provinces'targets may not be fully met,they provide a more realistic viewof what China can accomplish.Though climate mitigation is certainly one key underlying driver of China's hydrogen strategy,industrial and economic motivations seem more prominent in the short term.China hasplaced less emphasis on carbon intensity than the EU and the US,as evidenced by the Chinesegovernment's lack of a formal definition of renewable hydrogen.An Overview of China's Hydrogen LandscapeChina holds a substantial share of global hydrogen production,contributing roughly one-third oftotal output at around 33 Mt per year.5 This production heavily relies on fossil fuels(79 percent)-and about 21 percent of it originates as industrial by-product-resulting in 360 Mt of CO,emissions.'Meanwhile,the contribution of renewable hydrogen remains marginal,accounting for less than 0.1percent of production.3 As shown in Figure 1,China's industrial sector plays a pivotal role in drivingthe country's hydrogen consumption.32 energypolicy.columbia.edu