Hydrogen law and regulation in China


Hydrogen Innovation China - In 2018, China’s annual hydrogen production exceeded 20 million tonnes, and it has become the world's largest hydrogen energy producer and consumer. Production and sales of metal hydrogen storage materials have now surpassed Japan and China is fast becoming the world's largest hydrogen storage material producer and retailer. China produces mainly “grey” hydrogen with “green” hydrogen accounting for a very small proportion (less than 1%). It is likely that fossil fuel-based hydrogen will continue to be the main form of hydrogen produced in China over the next decade.

Over the last decade, particularly since the “13th Five-Year Plan” was outlined in 2016, there has been an enormous push to develop hydrogen-powered vehicles in China. Hydrogen fuel cells are a key component of hydrogen-powered vehicles, and hydrogen refuelling stations are the necessary infrastructure required to support the application of hydrogen fuel cell vehicles (“FCVs”) in China. At present, the application of hydrogen is mainly within the promotion of hydrogen-powered vehicles and also as the main material for synthetic chemicals.

The National Alliance of Hydrogen and Fuel Cell (or the China Hydrogen Alliance, “NAHFC”) was launched in February 2018 with the aim of enhancing “the development of China’s hydrogen sector in speed and quality”. NAHFC is a government supported alliance that was jointly formed by a consortium of energy and automotive companies, including China Energy Investment Group and state-owned SAIC Motor, as well as several leading science and technology institutes. Several international, major players from the energy industry are also members of NAHFC, for example Air Liquide, Air Products and Linde. NAHFC acts as a platform to enable coordinated innovation, research and development of hydrogen and fuel cell projects and as a thinktank to guide state policy.
In August 2020, NAHFC worked alongside the Hydrogen Council to produce the research report titled “Path to Hydrogen Competitiveness – A Cost Perspective”, a Chinese version of the Hydrogen Council’s 2019 report. The report highlighted that developments in technology, among other areas, will assist in reducing the costs associated with hydrogen production and stated that this is an area in which China has much to offer.
Since 2017, the development of China's hydrogen-powered and FCV industry has been in full swing. Hydrogen fuel cells are mainly used in commercial vehicles, which have different application fields from pure electric vehicles. Although hydrogen FCVs are still in an early stage of research and development in China, it is expected that the next five to ten years will become a "golden era" for the industrialisation and rapid promotion of hydrogen FCVs.

At the end of 2019, more than 130 hydrogen-refuelling stations had been built or were under construction in China: 61 had been completed and 52 were in operation. China has initially formed industrial clusters and demonstration-application areas in the Beijing-Tianjin-Hebei area, Yangtze River Delta, Pearl River Delta, Shandong Peninsula and the central region. These are areas of highly concentrated industrial activity where the cost of hydrogen infrastructure can be shared between market participants. At present, there are nearly 4,000 vehicles of various types operating in the demonstration areas, such as fuel cell cars, trucks and buses.

China already has a recognised hydrogen energy industrial foundation. Currently, however, its production is mainly reliant on fossil fuels and hydrogen is predominantly used as a raw material for the synthesis of industrial chemicals. Unsurprisingly, the steel and chemical production industries consume the greatest amounts of hydrogen in China. Domestic hydrogen produced from fossil fuels, such as coal, natural gas, and petroleum, accounts for almost 70%; hydrogen produced from industrial by-product gases accounts for about 30%; and hydrogen produced by electrolysis of water accounts for less than 1%.


It has been announced that, since 2017, Chinese investment into domestic hydrogen energy projects has exceeded CNY 250 billion. In the first half of 2019, there were as many as 70 domestic investment projects in the field of hydrogen energy and fuel cells, including investments of some tens of billions of Yuan, and 50 projects with a public investment amount exceeding CNY 90 billion.

In recent years, with the successive promulgation of national policies (which are discussed in more detail, below) many large enterprises have entered the hydrogen energy market. These include many well-known state-owned enterprises such as CHN ENERGY, State Grid and China HuaNeng Group.

Many energy-related private companies are also aggressively expanding into the hydrogen-energy market, intending to occupy a strategic place in the future market. Among them is Meijin Energy Group (“Meijin Energy”), one of the most high-profile names in the oil and gas industry. In June 2019, Meijin Energy announced that it had signed the "Qingdao Meijin Hydrogen Energy Town Cooperation Framework Agreement" with Qingdao Municipal Bureau of Industry and Information Technology. Under the agreement, the town’s total industrial land scale is planned to reach about 2,000 mu (equivalent to 1.33 km2) and will receive a total investment of CNY 10 billion – the majority of which will be provided by Meijin Energy. The purpose of the agreement is to invest in hydrogen technologies, for example commercial new energy vehicles (“NEVs”), membrane electrodes, fuel cell stacks and systems, as well as providing support for scientific and technological innovation centres, fuel cell testing centres and the research and production of other projects. Furthermore, the agreement stated that Meijin Energy will establish a platform dedicated to the construction and operation of hydrogen energy infrastructure and initiate the launch of a hydrogen energy industry fund for investment into major projects in the industrial chain.

In July 2019, Meijin Energy also announced that it had used its own funds to increase Guangdong SinoSynergy Hydrogen Power Development Co., Ltd. (“Synergy”) capital by CNY 180 million. Synergy have invested heavily in factories in the Yunfu Industry site, Guangdong Province, where they produced over 300 hydrogen-powered fuel cell-battery hybrid buses in 2018-2019. 3 Furthermore, in August 2019, Meijin Energy and Jiaxing Transportation Investment Group Co., Ltd. signed the "Jiaxing Hydrogen energy infrastructure construction and hydrogen fuel vehicle demonstration operation platform cooperation agreement." The agreement stipulates that the two parties will cooperate, through the establishment of a joint venture company, in the construction of hydrogen energy infrastructure in Jiaxing, Zhejiang Province, and in the demonstration operation platform of hydrogen-powered vehicles.

On 19 January 2019, Shanghai Re-fire Energy Technology Co., Ltd. and the People's Government of Nanhai District, Foshan City, Guangdong Province formally signed a contract. The former will invest in the construction of a hydrogen energy industry base project in Danzao Town, Nanhai District. The purpose of the project is to set up several research and development bases that will focus on investigation into hydrogen fuel cells, hydrogen-powered FCVs and the related industries. The project is expected to have an annual output value of CNY 15 billion. This follows another hydrogen-energy investment worth tens of billions of Yuan in Danzao Town; the Hydrogen Power (Foshan) R&D Centre and vehicle production project that was launched in 2017.


High costs, difficulties in storage and lack of hydrogen infrastructure

Since hydrogen needs to be produced twice, and the costs of its storage, transportation, and production are high, people in China are sceptical as to whether hydrogen energy is economically viable.

Industry experts say that the current core technology and equipment related to China's hydrogen infrastructure are not perfect, and a large amount of scientific and technological innovation and input are needed to reduce the cost of hydrogen energy. In addition, although the use of liquid hydrogen storage and transportation can reduce the cost of hydrogen, China's liquid hydrogen-related equipment manufacturing and industrialisation is in its early stages and it will take time for liquid hydrogen storage and transportation to be put into use.

Legislative framework
In common with many jurisdictions, China does not have a well-defined legislative framework for hydrogen projects across various sectors. This creates a number of gaps and uncertainties, which need to be addressed before the hydrogen economy is able to flourish.


China has not yet introduced specific or unified laws or administrative regulations on the use of hydrogen energy. The policy basis for the development of hydrogen energy utilisation in China is mainly founded on national industrial planning policies and local pilot regulations. Planning policies are discussed in more detail, below.

With regard to pilot regulations, ten provinces, including Guangdong and Shanxi, have included the development of hydrogen energy in their Government Work Reports in recent years. As well, provinces such as Shandong, Hebei and Zhejiang have successively released development plans for their local hydrogen energy industry. Additionally, many other provinces have formulated relevant policies to promote the development of the hydrogen energy industry that relate to the construction of hydrogen energy infrastructure, the manufacturing of key components and the supporting operation services. For example, the NEV industry action plan, issued by Shanxi Province in 2019, outlined plans to carry out hydrogen fuel vehicle projects in Taiyuan, Datong and other cities.

Policy and government programmes
The "13th Five-Year National Strategic Emerging Industry Development Plan” issued by the State Council in 2016 proposed to promote the development of on-board hydrogen storage systems and hydrogen preparation, storage, transportation and refuelling technologies, as well as to promote the construction of hydrogen refuelling stations.

In March 2020, the National Development and Reform Commission and the Ministry of Justice issued "Opinions on Accelerating the Establishment of Green Production and Consumption Laws and Policies", stating that the promotion of clean energy development requires the study and formulation of standards and supporting policies for new technologies, such as hydrogen and ocean energy.

In the Government Work Report of the State Council 2019, it is clearly stated that there is a national mandate to “promote the construction of charging and hydrogen refuelling facilities”. This is the first time that hydrogen energy has been included in a Government Work Report and reflects its growing importance in China.

Primary legislation
The draft "Energy Law of the People's Republic of China" issued on 10 April 2020 is narrow in its scope and only mentions hydrogen within the definition of "energy". Therefore, the importance and potential of hydrogen is yet to be fully reflected in China’s legislation.

According to the “Regulations on the Safety Management of Hazardous Chemicals”, hydrogen belongs on the hazardous chemicals list. Therefore, it is generally believed that the operators of hydrogen-production plants and hydrogen-refuelling stations should obtain hazardous chemical business licences. Such licences are issued by the safety production supervision and management department.

Energy supply
On 9 April 2020, the National Energy Administration issued the "Matters Concerning the Preparation of the 14th Five-Year Plan for Renewable Energy Development", which pointed out that combining new technologies, such as energy storage and hydrogen energy, could increase the proportion of renewable energy in regional energy supplies.

On 19 September 2019, the Central Committee of the Communist Party of China and the State Council issued the "Outline for Building a Powerful Transportation Country", requesting that the construction of hydrogen refuelling station facilities be expedited.

On 10 February 2020, the Ministry of Industry and Information Technology issued a relevant decision on the access of NEVs, requiring FCVs to have on-board hydrogen system leakage test instruments and equipment.

The Ministry of Transport issued the "Inland Waterway Navigation Development Outline" in June 2020, indicating that it will study and promote the application of hydrogen energy within the industry.

Also in June 2020, the General Office of the Ministry of Housing and Urban-Rural Development released the national standards, "Technical Specifications for Hydrogen Refuelling Stations (Draft for Partial Amendments)" and "Technical Standards for Automobile Refuelling and Hydrogen Refuelling Stations (Draft for Comments)", to solicit comments. Though these are still in draft form, the standards outline, amongst other things, the technical requirements for hydrogen pipelines and storage systems and the content of liquid hydrogen to be used at refuelling stations. It is not known when the standards may be finalised or when they are expected to come into force.

Foreign Investment
In terms of foreign investment, the "Catalogue of Industries Encouraging Foreign Investment (2019 Edition)" (the “Catalogue”) mentioned that various hydrogen energy industries will be included under the “foreign-investment encouraged” category. Among the industries to be included are the fuel production, storage, transportation, liquefaction, construction and operation of hydrogen refuelling stations, and hydrogen fuel cell manufacturing. The Catalogue is a government document that provides guidance on industries that are encouraged to seek investment - though it does not mean that foreign investment is required. Under the guidance, foreign investors interested to invest in hydrogen energy projects in China may enjoy preferential treatment, for example on taxation or land.

On 23 April 2020, the Ministry of Finance, the Ministry of Industry and Information Technology, the Ministry of Science and Technology, and the Development and Reform Commission jointly issued a notice adjusting current purchase subsidies for FCVs granting “rewards for compensation” to demonstration cities. The notice also stated that it should take about four years to establish the hydrogen energy and FCV industry chain. This timeframe has been estimated based on the currently high costs associated with producing hydrogen fuel cells, batteries and the long-distance transportation of hydrogen across the country.


It is no surprise that hydrogen, gasoline, and natural gas (i.e. rich in methanol) are classed as hazardous chemicals in the “Catalogue of Hazardous Chemicals (2015 Edition)”, due to their flammable nature. However, from an energy point of view, hydrogen does not yet have a dedicated regulatory department or corresponding classification system.

In April 2019, the State Council issued an opinion on implementing a division of labour among key work departments in the "Government Work Report". Instead of one central authority, the report recommended that various government departments should be responsible for: stabilising automobile consumption; continuing to implement preferential policies for the purchase of NEVs; and promoting the construction of charging and hydrogen refuelling facilities. Departments listed include the National Energy Administration, which is the competent authority for energy in China, and various other authorities which will each have a regulatory and supervisory role for different stages or processes, such as the production, storage or transportation of hydrogen.


In 2020, the Ministry of Education, the National Development and Reform Commission, and the National Energy Administration jointly issued the "Energy Storage Technology Professional Discipline Development Action Plan (2020-2024)", which will act as a roadmap for universities and other educational institutions. This plan notes that, in order to promote the hydrogen energy revolution in China, basic theoretical research at undergraduate, master and doctorate-level is needed over the coming years to develop highly efficient, low-cost energy storage systems. It is further noted that education and research should focus, in particular, on promoting compressed air energy storage, chemical-energy storage, new types of batteries, fuel cells, phase change energy and hydrogen storage.

Regarding major renewable energy projects for the "14th Five-Year Plan", the State Hydropower and Electricity Institute recently issued a notice stating that new energy power generation and hydrogen energy integration development projects are able to participate in the application process. It is expected that state-owned enterprises, such as China HuaNeng Group, China Datang Corporation and China Three Gorges Corporation, will apply to develop hydrogen energy projects.

On 22 September 2020, at the United Nations General Assembly, China pledged to achieve carbon neutrality by 2060 and to reach its peak carbon dioxide emissions by 2030. In order to facilitate this, the country will increase its nationally determined contributions and adopt more effective policies and measures. The continuous drop in the cost of hydrogen production from wind and solar power generation provides a potential decarbonisation path for industries in China that are most dependent on fossil fuel energy in economic activities, such as steel, heavy road freight, shipping and cement. China needs a long-term perspective to achieve its goal of net zero emissions in the future and solar, wind and hydrogen energy are all expected to be some of the most appropriate solutions.

Hydrogen Innovations Webmaster

Please send me all the information about Hydrogen Worldwide, I would like to publish it on my websites


Articles View Hits
Web Links