China launches its first national green hydrogen subsidy framework

China has introduced its first direct state funding mechanism for green hydrogen and e-fuels — a move that could reshape global clean-fuel economics.

On 14 October 2025, the National Development and Reform Commission (NDRC) issued the Decarbonisation Project in State Budget Administration Method, which for the first time allows state funds to cover up to 20 % of capital expenditure for five categories of decarbonisation projects.

The framework includes:

1. Heavy industry decarbonisation (power, steel, etc.)
2. Clean-coal retrofits for power and coal-to-chemical plants
3. Circular-economy projects
4. Net-zero or carbon-negative technology demonstrations — notably green methanol, SAF, CCUS, green hydrogen and green ammonia
5. Carbon-market infrastructure

The inclusion of green hydrogen and ammonia signals a clear policy shift: Beijing is now ready to fund production assets rather than only fuel-cell manufacturing or pilot FCEV schemes.

Photo: Sinopec

Analysts expect a broader green-hydrogen incentive package for 2026–2030, building on this new framework.

This marks a pivotal policy evolution that could accelerate China’s role in global e-fuel and hydrogen supply chains — influencing costs, technology diffusion, and investment flows across Asia and beyond.

Based on materials from Energy Iceberg / China Green Insight (LinkedIn post).