Energy Insider: Beijing Pushes Hydrogen Industry Development, Inner Mongolia Leads in Renewables Installation

This week’s Caixin energy wrap covers several significant developments in China’s energy policy, industrial initiatives, and projects, with a particular focus on hydrogen energy, renewables expansion in Inner Mongolia, offshore oil drilling, and long-distance transmission of renewable electricity [para. 1].

China is accelerating the construction of its hydrogen energy industry through a new plan announced by Beijing, which aims to establish a complete industry chain for hydrogen – a fuel seen as essential to a sustainable future. The National Energy Administration (NEA) will launch pilot projects in areas such as production, storage, transport, and usage of hydrogen, selecting candidate projects across 11 sectors. These include mass hydrogen production using renewables and hydrogen energy storage. Projects accepted by the NEA will receive government support, such as access to medium- and long-term loans, and must start trial operations by June 2028. This policy seeks to diversify development pathways and create experiences that can be replicated elsewhere [para. 5][para. 6][para. 7][para. 8].

The emphasis on hydrogen matters because it enables decarbonization in “hard-to-abate” sectors, such as long-distance transport and heavy industry, where alternatives are limited. China is already the world’s largest hydrogen producer and consumer, responsible for over a third of the global total. However, as of the 2025 China Hydrogen Energy Development Report, only about 1% of China’s hydrogen is renewable, with most still derived from fossil fuels [para. 9][para. 10][para. 11].

Inner Mongolia is leading China’s expansion of renewable energy. By May 2024, its installed new energy capacity—mainly wind and solar—reached 143 gigawatts (GW), representing 52% of its total energy capacity. In the first five months of the year, 124.7 terawatt-hours (TWh) of renewable electricity were generated, of which over a third was exported to other Chinese regions. The local energy authority plans to add 40 GW more capacity this year and increase exports to over 100 TWh. By the end of 2024, Inner Mongolia’s renewable capacity is expected to exceed 170 GW, solidifying its leadership in China’s energy transition [para. 13][para. 14][para. 15][para. 16].

The China National Offshore Oil Corporation (CNOOC) expects record-breaking offshore drilling from the Bohai Oil Field, which is China's largest offshore oil field. In 2024, production is set to surpass 40 million tons of oil equivalent for the first time. The company continues to expand into deep-sea drilling, launching three new platforms in 2024. CNOOC’s initiative stems from a seven-year plan to strengthen China’s energy self-sufficiency, with a target for the Bohai Oil Field to consistently hit or exceed 40 million tons of annual output between 2026 and 2030, and the aspiration to develop a gas field with reserves topping 1 trillion cubic meters in the next five years [para. 18][para. 19][para. 20][para. 21].

Finally, China is expected to open its first ultra-high-voltage (UHV) long-distance power line at the end of June 2024, which will transmit mostly wind and solar energy from the arid Ningxia region to Hunan, spanning 1,634 kilometers. This connection is projected to deliver 36–40 TWh annually—enough for over 13 million households. UHV technology is crucial for overcoming geographic mismatches between resource-rich interior regions and populous coastal centers. China plans to build up to 28 more UHV transmission lines in the coming years to address this logistical challenge [para. 23][para. 24][para. 25][para. 26][para. 27].

In summary, these measures underline China’s commitment to advancing its renewable and sustainable energy infrastructure while maintaining efforts to secure energy supply through traditional sources [para. 1][para. 5][para. 13][para. 18][para. 23].