[Source/Observer Network Chen Sijia] According to a June 4 report by the "Nikkei Asian Review," China has surpassed Japan in competitiveness in hydrogen-related patents, ranking first globally for the first time and becoming the most competitive country in this field. Chinese enterprises are continuously enhancing their technical capabilities in areas such as electrolyzer manufacturing, while hydrogen production in Europe and the U.S. is stagnating due to factors like inflation, widening China's leading advantage.

The data analysis institution Astamuse, funded by the Nikkei News Corporation, statistically analyzed patents in five major areas of hydrogen production, storage, transportation, supply, safety management, and utilization. Among approximately 180,000 hydrogen-related patents applied for worldwide from 2013 to 2022, the institution scored patent competitiveness based on feasibility and remaining patent term duration, among other factors.

Except for the utilization sector, China leads in the other four sectors and overall national strength, surpassing Japan, which ranked first in the previous survey (approximately 140,000 patents from 2011 to 2020). Since China proposed its goal to achieve carbon peaking before 2030 in September 2020, the number of annual patent applications has doubled compared to Japan's.

Patent Competitiveness Score of Hydrogen-Related Patents - Screenshot from the Nikkei Asian Review

According to the report, China’s advantages are particularly evident in the manufacturing sector, with efficiency rapidly improving. Data from Bloomberg New Energy Finance shows that in 2023, the equipment costs for green hydrogen manufacturing plants powered by renewable energy were only one-fourth of those of European companies.

According to Wood Mackenzie’s data, Chinese enterprises account for 60% of global electrolyzer manufacturing capacity, which is equipment used to produce hydrogen through water electrolysis. Meanwhile, Chinese enterprises have already dominated the global solar panel and wind turbine markets and are formulating strategies to apply the advantages of renewable energy to the hydrogen sector.

Chang Xiaoguang, an expert at Daiwa Securities Research Institute, stated: “Currently, Chinese enterprises focus more on market share and growth rate, expanding their manufacturing capabilities. They are eyeing overseas expansion and planning to establish factories in Europe and the Middle East.”

In 2022, China released its hydrogen industry development plan, clearly stating that hydrogen is an important component of the future national energy system. The plan also proposed increasing green hydrogen production to between 100,000 and 200,000 tons annually by 2025, but the actual progress far exceeds the target.

China Petrochemical Xinjiang Kuche Green Hydrogen Demonstration Project - Visual China, November 2, 2023

The "Nikkei Asian Review" pointed out that although Japan announced its hydrogen basic strategy in 2017, China has surpassed Japan in project advancement speed due to the large number of participating enterprises. By 2024, there were 100 to 200 electrolyzer manufacturers in China, creating intense competition, while Japan only had a few companies like Asahi Kasei and Toshiba.

Japan and Europe have always focused on hydrogen demand in areas like fuel cell vehicles, whereas Chinese enterprises pay more attention to industrial sectors with high hydrogen consumption, such as chemicals and steel. In fields where it is difficult to replace thermal energy with electricity, hydrogen is gaining attention as an alternative energy source. For example, China Baowu Steel Group has introduced hydrogen into existing blast furnaces last year.

As hydrogen production costs continue to decrease, China's demand for hydrogen is increasing. According to International Energy Agency (IEA) data, China's annual hydrogen demand reached 28 million tons in 2023, accounting for about 30% of the global total, making it the largest hydrogen market.

In contrast, Europe is facing headwinds in the hydrogen market due to inflation and rising material costs. France’s energy giant ENGIE and Spain’s Iberdrola have both lowered their hydrogen production targets by 2030. The "Nikkei Asian Review" predicts that as hydrogen production in Europe and the U.S. stalls, the gap between them and China will widen.

According to CCTV News reports, on April 28, the National Energy Administration held a press conference and publicly released China’s first hydrogen development report. The report shows that in 2024, China's hydrogen production and consumption scale exceeded 36.5 million tons, ranking first in the world. By the end of 2024, the cumulative annual built capacity of global renewable energy hydrogen projects exceeded 250,000 tons, with China accounting for more than half, gradually becoming a leading country in global renewable energy hydrogen production and related industries.

This article is an exclusive piece from the Observer Network and cannot be reprinted without permission.

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