Alternative Drives New Fuel Cell Initiative from Beijing

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China is not giving up on hydrogen, but is intensifying its efforts. The number of vehicles with fuel cells on China's roads is to be doubled by 2030, according to a new directive from the Ministry of Industry in Beijing.

The document published on March 16 by the Ministry of Industry MIIT and two other ministries sets clear goals for the extensive development of the hydrogen economy in transportation and industry. The strategy is based on the premise that government support is still needed to scale the technology to the point where technological breakthroughs can sufficiently reduce the efficiency and cost of application. It is the same approach that has already pushed solar energy and the e-mobility sector in China.

100,000 FCEVs on Chinese Roads by 2030

By 2030, 100,000 fuel cell electric vehicles (FCEVs) are expected to be on China's roads. That is around twice as many as today. By the end of 2025, around 40,000 hydrogen fuel cell vehicles will have been sold in China, according to the official news agency Xinhua. In addition, there are currently 574 hydrogen filling stations with a cumulative daily refuelling capacity of more than 360 tons. Last year, the number of new FCEV registrations accelerated, exceeding 10,000 per year for the first time according to insurance data, as reported by the Chinese Passenger Car Association (CPCA).

This was an increase of 47 percent compared to the previous year. Cumulatively, almost 40,000 FCEVs will have been sold in China by the end of 2025. This makes China one of the world's leading countries in this area, writes the Ministry of Industry. However, a sober look at the available figures also shows that the fuel cell, just like hydrogen in industry, is still a niche technology in the People's Republic.

Overcoming Challenges

China is struggling with the same problems that are often cited by opponents of the fuel cell in Germany. The energy efficiency over the entire life cycle of the hydrogen chain is currently still low. This is partly because a double conversion of energy from solar or nuclear power into hydrogen is required, then back into drive energy in vehicles or industrial plants after transportation.

As the debate on the new hydrogen initiative this year shows, China also sees these problems very clearly, but draws completely different conclusions from them than German experts. Firstly, they believe that they can promote technological breakthroughs by establishing comprehensive hydrogen ecosystems, which can then be used to solve the efficiency and cost issues step by step. Secondly, individual objections, such as energy efficiency, should not be allowed to become the sole deciding factor in the debate. Chinese experts and government representatives argue that there are a whole range of important reasons why hydrogen must be part of a smart energy strategy for the country.

Among other things, hydrogen is by far the cleanest technology with which renewable energies can be used. Combustion is completely emission-free. No environmental toxins are produced, as is the case when mining lithium or recycling the millions of traction batteries that China's car industry will soon have to dispose of.

There Is No Way Around Hydrogen

The business portal Zhongguo Jingyingwang quoted Lin Boqiang, Dean of the Institute for Energy Policy at Xiamen University, as saying that hydrogen is a technology that "cannot be ignored" on the path to a green energy transition in China. According to Lin, the current tensions in the Strait of Hormuz have once again underlined the importance of energy security. China has already expanded wind and solar energy to such an extent with this problem in mind. From now on, hydrogen will "probably play a bigger role", says the expert and government advisor.

As is so often the case, China is not planning here solely on the basis of technological facts or limits known today, but is incorporating the possibility of future innovations into its plans.

For example, there are hopes of breakthroughs in the field of nuclear fusion in the coming years. Beijing is also investing a lot of money in research and development in this future technology.

Is the Breakthrough in Nuclear Fusion Coming?

In other words, China does not confuse the current technological hurdles with the basic physical laws of thermodynamics, but regards them as technically solvable application issues. Fuel cell drives are already extremely efficient. They now want to work even harder on the rest of the supply chain.

Should the breakthrough in nuclear fusion actually come one day, the aim is to have already established hydrogen supply chains that can be used in such an event to produce hydrogen extremely cheaply via electrolysis using nuclear power. Beijing believes that a successful long-term energy policy also requires investments with a certain degree of risk.

Hydrogen in the Cluster Focus

For these reasons, the Beijing government's new directive announces new pilot programs "for the comprehensive application of hydrogen energy" throughout the country from this year, for which "clusters of cities" can submit an application. They must demonstrate extensive applications in the areas of the use of trucks with fuel cells, transport and storage of hydrogen, industrial applications and other projects before they are accepted into the program.

The focus on clusters rather than individual cities reflects the assumption that the bundling of different resources is necessary. For example, there is more production of green hydrogen in the north of the country, while the chemical industry and hydrogen metallurgy are further east. Each cluster should be able to play to its respective strengths.

The winners of this tender are to receive up to 1.6 billion yuan (approx. EUR 200 million; USD 230 million) per city cluster from the central government over the next four years. As soon as the number of FCEVs has doubled and progress has been made in the areas of storage and transportation, Chinese planners are hoping for synergy effects with industrial applications.

Aiming for Green Hydrogen

Green hydrogen, produced from solar and wind energy in China's desert regions and elsewhere, is already being used in the country's chemical industry to produce ammonia, methanol and for some processes in refineries. The first commercial uses are also already being found in the shipping industry.

The problem that a large proportion of the available hydrogen is currently still being produced using fossil fuels is also being addressed. China's hydrogen production in 2025 was the largest in the world at more than 37 million tons. The annual capacity for renewable hydrogen reached more than 250,000 tons in the same period. This was double the previous year's figure, according to the National Energy Administration.

All aspects of the hydrogen ecosystem are now to be worked on simultaneously and even more intensively. "Government officials expect the ramp-up of applications to trigger major technological leaps and breakthroughs in key areas such as fuel cells, electrolyzers, storage and transportation equipment," writes CNEVPOST. Hydrogen and the fuel cell have been confirmed in the Chinese government's new five-year plan as a "future technology" that is to be vigorously promoted. It takes a very realistic view that the technology is still at an "early stage of industrialization", but underlines its "great long-term potential as a carbon-free secondary energy source".

This "ambitious" new hydrogen plan has the potential to bring about a turning point in terms of energy efficiency and the cost of industrial hydrogen chains, Chinese commentators write. As soon as the commercial benefits become visible in the city clusters, more investment in research and development centers can be expected, just as is already happening in the many science and technology clusters for e-mobility, they argue.

China versus Germany

While the "technological breakthroughs" are not unlikely, they cannot be predicted with certainty, China has a lot of experience in reducing costs. This is now being applied again to fuel cells and the industrial use of hydrogen. The new pilot projects aim to reduce the price of hydrogen for end customers to below 25 yuan per kilogram (approx. EUR 3.10 per kg; USD 3.60 per kg), and even to around 15 yuan in preferred regions, writes Xinhua.

The long-term nature of Chinese planning and the holistic, comprehensive nature of the strategy are in stark contrast to what is happening in Germany when it comes to hydrogen. According to media reports, the number of hydrogen filling stations in Germany has recently fallen again. Once there were 80, now there are just over 50, and many of them are operating at a loss.

In 2025, 49 passenger cars with fuel cells were registered in Germany, 69 percent fewer than in the previous year compared to around 545,000 battery electric vehicles, according to the Federal Motor Transport Authority (KBA). German experts are of the opinion that "the market has spoken". The Chinese approach that the market initially needs to be given a helping hand with future technologies is frowned upon by many. In the German debate, however, the question regularly arises as to whether we will again lose the "race" to China when it comes to hydrogen, as we have already done with solar energy or e-mobility. Unfortunately, this does not seem unlikely at the moment.

If you want to remain optimistic, you can hope that China will be successful in reducing costs and increasing efficiency in the field of hydrogen technologies. Then this technology of the future will one day become cheaper in Germany, just like photovoltaics. (se)

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