A hydrogen-powered bus is refueled at a station in Zhangjiakou. Photo: Zhang Hui/GT

The National Development and Reform Commission (NDRC), China's top economic planner, issued the medium- and long-term development plan for the hydrogen energy industry (2021-35) on Wednesday, aiming to produce 100,000 to 200,000 tons of green hydrogen a year and have about 50,000 hydrogen-fueled vehicles by 2025.

The document, which sets the targets and timetable for the development of the industry for the first time, is a clear indication of the importance of hydrogen energy holds for the country's energy system into the future. It also marks China's entry into the global race to accelerate the development of hydrogen energy.

For a long time, hydrogen energy has been considered a challenge due to technological obstacles blocking widespread adoption. Yet, the geopolitical disruption brought by the Russia-Ukraine conflict and Western sanctions on Russia's energy sector is sending huge shockwaves throughout global energy markets, resulting in changes in views toward the development of hydrogen energy in various countries.

While the US and European countries are struggling to pursue steady supply channels of traditional fossil fuels such as oil and gas, that doesn't mean the global energy transition toward zero-carbon have been reversed. In fact, the situation in Ukraine may serve as a reminder to countries of the importance of ensuring their own energy security, which, from another perspective, may actually speed up the energy transition pace in Europe once the risk surrounding a short-term energy crisis is addressed. And this will certainly enhance the strategic advantage of the EU and other Western countries.

For instance, Germany plans to rapidly accelerate the expansion of renewable energy sources, aiming to fulfill all its electricity needs with supplies from renewable sources by 2035, five years ahead of the previous schedule of 2040.

Ursula von der Leyen, the European Commission president, also made it clear in a recent speech that hydrogen, as along with other renewables, will play an important role in ending Europe's dependence on Russian fossil fuels.

The geopolitical tension in Europe also serves as a reminder to China that as the world's largest energy producer and consumer, it is essential for China to attach renewed importance to energy security, which is of strategic significance to both economic development and foreign policies.

China's reliance on overseas oil stood at 72 percent in 2021, with its dependence on natural gas imports around 40 percent. Given the huge amount of energy needs, it is impossible for China to achieve 100 percent energy independence in terms of traditional fossil fuels such as oil and gas.

However, it has become increasingly challenging for China to ensure the supply security of traditional energy against the background of the intensifying geopolitical frictions. Therefore, China must at least reduce its over-reliance on fossil fuels.

On the other hand, if China is to meet its goals of peaking carbon emissions before 2030 and realizing carbon neutrality by 2060, it will need to implement major reforms to its current energy structure. While there is no denying that it will take a long time for green energy to significantly contribute to China's energy supply, during the process, the development of hydrogen energy is expected to play a major role.

As a clean, flexible and efficient form of energy, hydrogen has the potential to achieve wide commercial adoption with the future technological progress and lowering costs. Once the core technological obstacles are addressed, it can quickly give rise to a new industrial economy. In this sense, the hydrogen energy sector is where investment and policy supports are really needed in China for the purpose of energy security.