{"id":60131373,"date":"2026-05-07T12:39:28","date_gmt":"2026-05-07T11:39:28","guid":{"rendered":"https:\/\/dialogue.earth\/?p=60131373"},"modified":"2026-05-07T12:41:25","modified_gmt":"2026-05-07T11:41:25","slug":"chinas-new-hydrogen-push-could-be-a-step-towards-cleaner-steel","status":"publish","type":"post","link":"https:\/\/dialogue.earth\/en\/energy\/chinas-new-hydrogen-push-could-be-a-step-towards-cleaner-steel\/","title":{"rendered":"China\u2019s new hydrogen push could be a step towards cleaner steel"},"content":{"rendered":"\n<p>Hydrogen has been <a href=\"http:\/\/www.nea.gov.cn\/2022-03\/23\/c_1310525755.htm\">described<\/a> by the Chinese government as of \u201cgreat significance\u201d to the country\u2019s clean-energy transition, but its uptake in a range of carbon-intensive sectors has so far faced hurdles of cost and logistics.<\/p>\n\n\n\n<p>Now, a policy push is seeking to encourage the production of hydrogen, including \u201cgreen\u201d hydrogen made using renewable energy. The aim is to develop China\u2019s hydrogen industry and boost its wider usage, including in the country\u2019s vast steel industry.<\/p>\n\n\n\n<p>In March, three government ministries launched a <a href=\"https:\/\/dialogue.earth\/en\/digest\/china-boosts-hydrogen-especially-for-industrial-use\/\">new pilot programme<\/a> that will reward five city clusters for pursuing and reaching targets on hydrogen. Among its <a href=\"https:\/\/mp.weixin.qq.com\/s\/Z1kzizqkHxme7x6X3lIR4g\">focuses<\/a> is encouraging projects \u201cpromoting the steel industry\u2019s transition\u201d that make use of low-carbon hydrogen sources.<\/p>\n\n\n\n<p>Green hydrogen is seen as <a href=\"https:\/\/steelwatch.org\/steelwatch-explainers\/hydrogen\/\">a critical input<\/a> for reducing emissions from steelmaking, as a lower-carbon fuel for the processing of iron ore, which conventionally takes place in coal-powered blast furnaces, or using natural gas. But only a limited number of facilities are currently producing steel at a commercial scale like this, both in China and globally.<\/p>\n\n\n\n<p>The new programme was announced on the heels of the <a href=\"https:\/\/greenfdc.org\/chinas-15th-five-year-plan-2026-2030-a-comprehensive-analysis-for-chinas-green-transition-in-climate-emissions-energy-industry-metals-and-finance\/\">15<sup>th<\/sup> Five Year Plan<\/a>, China\u2019s economic blueprint for 2026-2030, which emphasised ambitions to pursue hydrogen as a new energy source and \u201cindustry of the future\u201d.<\/p>\n\n\n\n<p>As the new hydrogen push launches and officials describe a potential \u201c<a href=\"https:\/\/mp.weixin.qq.com\/s\/VuTuI4GSNUMpeyoJKZ-IGQ\">inflection point<\/a>\u201d in the sector, Dialogue Earth spoke with experts to understand the impacts this policy could have on green hydrogen\u2019s role in the steel industry\u2019s decarbonisation.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-china-s-new-hydrogen-push\">China\u2019s new hydrogen push<\/h2>\n\n\n\n<p>Since the <a href=\"https:\/\/www.csis.org\/analysis\/china-unveils-its-first-long-term-hydrogen-plan\">launch<\/a> in 2022 of China\u2019s first long-term <a href=\"http:\/\/www.nea.gov.cn\/2022-03\/23\/c_1310525755.htm\">hydrogen plan<\/a> (for 2021-2035), the gas has become a more strategic part of China\u2019s industrial decarbonisation agenda.<\/p>\n\n\n\n<p>The new hydrogen policy released in March has been described as \u201c<a href=\"https:\/\/energyiceberg.substack.com\/p\/chinas-hydrogen-subsidy-20-design\">an expanded 2.0<\/a>\u201d version of a previous city-cluster programme launched in 2021, which focused on its use in fuel-cell vehicles. <a href=\"https:\/\/paper.people.com.cn\/zgnyb\/pc\/content\/202505\/05\/content_30072202.html\">Pilot city clusters<\/a> under the 2021 policy received a total of about CNY 5.1 billion (USD 719 million) in central-government awards over more than three years. China has <a href=\"https:\/\/dieselnet.com\/standards\/cn\/nev.php\">long provided<\/a> financial support for fuel-cell vehicles as part of its broader push towards electric vehicles.<\/p>\n\n\n\n<p>The new policy retains the focus on fuel-cells, while expanding hydrogen&#8217;s industrial use, including for steel and metallurgy, green ammonia and methanol, shipping and aviation.<\/p>\n\n\n\n<div class=\"wp-block-cd-article-image aligncenter block--article-image block--article-image--article\" itemscope itemtype=\"http:\/\/schema.org\/ImageObject\"><div class=\"block--article-image__column\"><div class=\"hide-expand block--article-image__image\"><img class=\"lazy\" data-src=\"https:\/\/dialogue.earth\/content\/uploads\/2026\/05\/A-hydrogen-refueling-station-in-Qingdao-Shandong_CFOTO_Sipa-USA_Alamy_3C1PJ47.jpg\" data-srcset=\"https:\/\/dialogue.earth\/content\/uploads\/2026\/05\/A-hydrogen-refueling-station-in-Qingdao-Shandong_CFOTO_Sipa-USA_Alamy_3C1PJ47-768x506.jpg 768w, https:\/\/dialogue.earth\/content\/uploads\/2026\/05\/A-hydrogen-refueling-station-in-Qingdao-Shandong_CFOTO_Sipa-USA_Alamy_3C1PJ47-1024x674.jpg 1024w, https:\/\/dialogue.earth\/content\/uploads\/2026\/05\/A-hydrogen-refueling-station-in-Qingdao-Shandong_CFOTO_Sipa-USA_Alamy_3C1PJ47.jpg 2560w\" data-sizes=\"(max-width: 600px) 768px, (max-width: 1024px) 1024px, 2560px\" alt=\"A bus is refuelling at a hydrogen refuelling station\"\/><\/div><div class=\"block--article-image__content\"><div itemprop=\"caption\" class=\"block--article-image__caption\">A hydrogen fuel-cell bus refuels at a station in Qingdao, Shandong province. Fuel-cell vehicles have been a focus of previous policies targeting China\u2019s broader switch to electric vehicles (Image: CFOTO \/ Sipa USA \/ Alamy)<\/div><\/div><\/div><meta itemprop=\"contentUrl\" content=\"https:\/\/dialogue.earth\/content\/uploads\/2026\/05\/A-hydrogen-refueling-station-in-Qingdao-Shandong_CFOTO_Sipa-USA_Alamy_3C1PJ47.jpg\"\/><meta itemprop=\"contentSize\" content=\"1 MB\"\/><meta itemprop=\"height\" content=\"1686\"\/><meta itemprop=\"width\" content=\"2560\"\/><meta itemprop=\"author\"\/><meta itemprop=\"representativeOfPage\" content=\"true\"\/><\/div>\n\n\n\n<p>Isadora Wang, head of China at the Transition Asia think-tank, told Dialogue Earth this latest programme is a \u201cvery good initiative\u201d for steel.<\/p>\n\n\n\n<p>\u201cUnlike transport, which can use batteries and many other approaches, steel and chemicals have very limited options for decarbonisation,\u201d she said, adding that they are the sectors \u201cmost in need of green hydrogen\u201d.<\/p>\n\n\n\n<p>Compared with more than <a href=\"https:\/\/kr-asia.com\/nev-companies-received-usd-5-billion-in-subsidies-from-the-chinese-government-between-2016-and-2020\">CNY 32 billion (USD 5 billion)<\/a> of subsidies injected into China\u2019s EV industry between 2016 to 2020, the ambition for hydrogen is much smaller. Only about a CNY 8 billion (USD 1.17 billion) in total \u2013 up to CNY 1.6billion (USD 232 million) per city cluster \u2013 will be issued over the next four years for hydrogen projects.<\/p>\n\n\n\n<p>Shen Xinyi, a China analyst focusing on steel at the Centre for Research on Energy and Clean Air, said the smaller subsidies reflect the \u201cmore complicated nature of hydrogen\u201d. Since hydrogen has a wider range of applications than EVs, a \u201c\u2018one-size-fits-all\u2019 approach\u201d or \u201cgoing \u2018all in\u2019 like with solar or EVs\u201d is impractical, she said.<\/p>\n\n\n\n<p>Wang said the design \u2013 \u201crewards rather than direct subsidies\u201d \u2013 would help to avoid the \u201cchaotic situation\u201d, such as fraud, seen in EV subsidies. An audit by China\u2019s industry ministry found at least CNY 864 million (USD 121 million) in subsidies for EVs were allegedly <a href=\"https:\/\/www.reuters.com\/business\/autos-transportation\/chinas-chery-byd-may-have-repay-subsidies-after-audit-finds-irregularities-2025-07-11\/\">\u201cimproperly claimed\u201d<\/a>. EV sales in China also <a href=\"https:\/\/finance.yahoo.com\/news\/china-ev-sales-growth-seen-152607000.html?guccounter=1&amp;guce_referrer=aHR0cHM6Ly93d3cucGVycGxleGl0eS5haS8&amp;guce_referrer_sig=AQAAACMdKjSmTJrqS-4vx3Fd_Q82GMTAVf1Cc4UOvs4UCsU5l31npb7lUD0plDjYHyRHutcnaKfFJA08yDz3986f3F41P6MarQ3EomI7faP-7EioGyv7Q3xs12uYjX8H8XBlWU7J9GUn6SI13bZP4oxzcQ32-gHsViw3c2JuUnfYvcKE\">slowed<\/a> after China <a href=\"https:\/\/dialogue.earth\/en\/digest\/china-ends-electric-vehicle-subsidies\/\">ended consumer purchase subsidies<\/a> in 2023.<\/p>\n\n\n\n<p>\u201cThat experience showed how important subsidy design is,\u201d Wang said. She said this \u201cmore refined\u201d incentive is \u201crelatively stable and predictable over four years and can draw in some private investment. That, in turn, could help the industry take shape.\u201d<\/p>\n\n\n\n<a class=\"wp-block-cd-related-news alignright block--related-news loading\" data-post-id=\"60130421\"><div class=\"block--related-news__image\"><\/div><div class=\"block--related-news__content\"><span class=\"block--related-news__heading\">Recommended<\/span><span class=\"block--related-news__title\"><\/span><\/div><\/a>\n\n\n\n<p>Both Wang and Shen said the biggest challenge for deployment is that hydrogen \u201cis still too expensive\u201d. The policy aims to bring down the <a href=\"https:\/\/www.yicaiglobal.com\/news\/china-to-cut-hydrogen-prices-to-usd363-per-kg-by-2030\">end-use price<\/a> from current levels of roughly <a href=\"https:\/\/stcn.com\/article\/detail\/3680372.html\">CNY 35-50<\/a> (~USD 5.10-7.30) per kilogram to CNY 25 by 2030, with some \u201cadvantageous regions\u201d \u2013 those with high renewable energy potential \u2013 aiming to cut the price to around CNY 15 per kg.<\/p>\n\n\n\n<p>The cost of green hydrogen production in China currently stands at <a href=\"https:\/\/lw.xinhuanet.com\/20251202\/e0f3cbcbed7844f198dc0ce5e453e856\/c.html\">CNY 21-46<\/a> per kg, but end-user prices are higher due to factors such as transport costs.<\/p>\n\n\n\n<p>Wang said CNY 25 is \u201cvery competitive for chemical products\u201d, but is not low enough for hydrogen-based metallurgy, which needs cost of CNY 10-15 per kg.<\/p>\n\n\n\n<p>\u201cIt is still fundamentally a pilot-driven policy, not yet a market-wide commercial rollout plan,\u201d Wang added. She described the programme\u2019s emphasis on regulation as \u201cmore suited to China\u2019s national conditions\u201d than approaches other markets may take.<\/p>\n\n\n\n<p>In contrast, the <a href=\"https:\/\/energy.ec.europa.eu\/topics\/eus-energy-system\/hydrogen\/european-hydrogen-bank_en\">European Hydrogen Bank<\/a> supports renewable-based hydrogen projects through competitive auctions, while the US offers <a href=\"https:\/\/afdc.energy.gov\/laws\/13399\">tax credits<\/a> of up to USD 3 per kg (though the green credentials of the hydrogen it supports has been <a href=\"https:\/\/www.canarymedia.com\/articles\/hydrogen\/the-case-against-the-us-governments-big-blue-hydrogen-bet\">questioned<\/a>). Japan, meanwhile, offers a different style of subsidies in the form of <a href=\"https:\/\/www.solarpaces.org\/japan-to-pay-15-years-cost-difference-to-birth-green-hydrogen-technologies\/\">contracts for difference<\/a>, which cover the difference between the cost of low-carbon hydrogen and a conventional-fuel benchmark.<\/p>\n\n\n\n<p>\u201cFor steel decarbonisation, this is better understood as an enabling step rather than as proof that hydrogen-based steelmaking is about to scale across China,\u201d said Shen.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-hydrogen-steelmaking-takes-time\">Hydrogen steelmaking takes time<\/h2>\n\n\n\n<p>The use of hydrogen in China\u2019s steel sector is still at an early commercial stage, with only a handful of companies operating facilities using <a href=\"https:\/\/dialogue.earth\/en\/climate\/chinas-greener-steelmakers-spread-overseas\/\">hydrogen-based direct reduced iron with electric arc furnaces<\/a>.<\/p>\n\n\n\n<p>This pathway is seen as the <a href=\"https:\/\/transitionasia.org\/will-china-win-the-green-steel-race\">most mature<\/a> route to near-zero emissions steelmaking. But globally, almost all direct reduction of iron (DRI) \u2013 a process to remove oxygen from iron ore and enable its use in steelmaking \u2013 is currently carried out using fossil fuels. Meanwhile, the build-up and utilisation of electric arc furnaces (EAF) in China has <a href=\"https:\/\/energyandcleanair.org\/publication\/reclaiming-credibility-in-chinas-steel-industry\/\">stalled<\/a>. Coal-based blast furnaces still account for nearly 90% of China\u2019s steel production and are the main driver of the sector\u2019s roughly <a href=\"https:\/\/www.climatebonds.net\/data-insights\/publications\/financing-decarbonisation-chinas-steel-sector-insights-transition-finance-pilot-market-progress\">15%<\/a> share of national emissions.<\/p>\n\n\n\n<div class=\"wp-block-cd-article-image aligncenter block--article-image block--article-image--article\" itemscope itemtype=\"http:\/\/schema.org\/ImageObject\"><div class=\"block--article-image__column\"><div class=\"hide-expand block--article-image__image\"><img class=\"lazy\" data-src=\"https:\/\/dialogue.earth\/content\/uploads\/2026\/05\/Steel-production-at-a-steel-plant-in-Huaian-Jiangsu_CFOTO_Sipa-USA_Alamy_2S1CHW2.jpg\" data-srcset=\"https:\/\/dialogue.earth\/content\/uploads\/2026\/05\/Steel-production-at-a-steel-plant-in-Huaian-Jiangsu_CFOTO_Sipa-USA_Alamy_2S1CHW2-768x576.jpg 768w, https:\/\/dialogue.earth\/content\/uploads\/2026\/05\/Steel-production-at-a-steel-plant-in-Huaian-Jiangsu_CFOTO_Sipa-USA_Alamy_2S1CHW2-1024x768.jpg 1024w, https:\/\/dialogue.earth\/content\/uploads\/2026\/05\/Steel-production-at-a-steel-plant-in-Huaian-Jiangsu_CFOTO_Sipa-USA_Alamy_2S1CHW2.jpg 2560w\" data-sizes=\"(max-width: 600px) 768px, (max-width: 1024px) 1024px, 2560px\" alt=\"A industrial complex emits thick white smoke from multiple chimneys against a hazy skyline\"\/><\/div><div class=\"block--article-image__content\"><div itemprop=\"caption\" class=\"block--article-image__caption\">Steel production at Huaigang Special Steel in Huai&#8217;an, Jiangsu province. Around 90% of China\u2019s steel output still comes from coal-based blast furnaces (Image: CFOTO \/ Sipa USA \/ Alamy)<\/div><\/div><\/div><meta itemprop=\"contentUrl\" content=\"https:\/\/dialogue.earth\/content\/uploads\/2026\/05\/Steel-production-at-a-steel-plant-in-Huaian-Jiangsu_CFOTO_Sipa-USA_Alamy_2S1CHW2.jpg\"\/><meta itemprop=\"contentSize\" content=\"1 MB\"\/><meta itemprop=\"height\" content=\"1919\"\/><meta itemprop=\"width\" content=\"2560\"\/><meta itemprop=\"author\"\/><meta itemprop=\"representativeOfPage\" content=\"true\"\/><\/div>\n\n\n\n<p>Among the companies with hydrogen-based projects are state-owned Baowu Steel \u2013 the world\u2019s largest steelmaker \u2013 and Hebei Iron &amp; Steel (HBIS).<\/p>\n\n\n\n<p>In late 2025, Baowu <a href=\"https:\/\/gmk.center\/en\/news\/china-launches-first-steel-production-line-with-near-zero-emissions\/\">completed<\/a> a million-tonne capacity hydrogen DRI-EAF production line in Zhanjiang, Guangdong province. In January, it also announced plans for the CNY 11.9 billion (USD 1.54 billion) <a href=\"https:\/\/chinahydrogen.substack.com\/p\/80000-tons-green-hydrogen-this-project\">Yangjiang hydrogen project<\/a>, 200 km to the east. This green hydrogen production hub will also feature a dedicated pipeline network connecting Yangjiang to major end-users, including <a href=\"https:\/\/www.sznews.com\/news\/content\/2026-01\/23\/content_31914409.htm\">Baowu\u2019s facilities in Zhanjiang<\/a>. Pipelines are the most economical option for transporting hydrogen in China, especially for distances longer than 200 km, according to a 2024 <a href=\"https:\/\/www.sciencedirect.com\/science\/article\/abs\/pii\/S0360544224029761\">study<\/a>.<\/p>\n\n\n\n<a class=\"wp-block-cd-related-news alignright block--related-news loading\" data-post-id=\"60127271\"><div class=\"block--related-news__image\"><\/div><div class=\"block--related-news__content\"><span class=\"block--related-news__heading\">Recommended<\/span><span class=\"block--related-news__title\"><\/span><\/div><\/a>\n\n\n\n<p>HBIS, meanwhile, runs the other large-scale <a href=\"http:\/\/www.worldmetals.com.cn\/viscms\/bianjituijianxinwen1277\/20240917\/265534.html\">hydrogen-based steel plant<\/a> currently operating in China, at a facility in Zhangjiakou, Hebei province.<\/p>\n\n\n\n<p>For Shen, the fact that Baowu still uses \u201cgrey hydrogen\u201d from <a href=\"https:\/\/tenova.com\/newsroom\/latest-tenova\/first-ever-dri-production-baowu-china\">hydrogen-rich<\/a> coke oven gas, rather than green hydrogen produced with green electricity, shows how hard it is to commercialise a fully green hydrogen DRI-EAF.<\/p>\n\n\n\n<p>Shen explained that DRI steelmaking costs about twice as much as the blast-furnace route, while green electricity requires stronger grid connections that are not feasible for every factory. \u201cMost demonstration projects are not economically viable on their own. But without this kind of pilot, the chance of it becoming economically viable on its own would be even smaller,\u201d she added.<\/p>\n\n\n\n<p>\u201cWhat is still missing is a combination of cheaper green hydrogen, more reliable access to low-cost clean electricity, suitable high-grade iron ore or pellets, stronger EAF economics, and clearer downstream willingness to pay for lower-carbon steel.\u201d<\/p>\n\n\n\n<p>A recent <a href=\"https:\/\/pubs.rsc.org\/en\/content\/articlelanding\/2026\/ee\/d6ee00643d\">paper<\/a> found that the \u201clevelised cost\u201d of hydrogen DRI-EAF steel could be reduced by 6-10% by pursuing \u201cflexible strategies\u201d across production stages, including pairing with energy storage, so the system can \u201cbetter align the variable renewable power supply and industrial production demand\u201d. HBIS, for example, is reportedly <a href=\"https:\/\/global.chinadaily.com.cn\/a\/202407\/04\/WS6685f916a31095c51c50c497.html\">developing<\/a> energy storage projects to support its production.<\/p>\n\n\n\n<div class=\"wp-block-cd-accordion block--accordion\"><span class=\"block--accordion__title\"><strong>What is the \u2018levelised cost of steel\u2019?<br\/><\/strong><\/span><div class=\"block--accordion__content\"><div class=\"block--accordion__content__inner\">\n<p>LCOS is a measure of the average cost of producing one tonne of steel over the entire lifetime of a steelmaking facility, accounting for all capital and operating expenditures spread across total lifetime output. Since green steel routes tend to have higher capital expenditure but potentially lower long-run operating expenditure (especially as renewable energy and electrolyser costs fall), LCOS helps analysts assess at what carbon price, energy price, or policy support level green steel becomes cost-competitive with conventional production.<br><\/p>\n<\/div><\/div><\/div>\n\n\n\n<p>\u201cThe challenge is that most of the steel is still produced in the blast furnace-basic oxygen furnace route, rather than the direct reduced iron-electric arc furnace route in China,\u201d the paper\u2019s lead author, He Yuezhang from Tsinghua University, explained to Dialogue Earth. \u201cSo you would basically need to rebuild the system from the ground up for it to match the power grid with increasing renewable penetration.\u201d<\/p>\n\n\n\n<p>As for moving away from the blast furnace route, Shen said dismantling large numbers of these plants is hard: \u201cBlast-furnace steelmaking in China has become so cheap. Many aging furnaces are still running because they support employment and social stability.\u201d<\/p>\n\n\n\n<p>She said it is better to stop building new blast furnaces and to retrofit existing plants for decarbonised production, with the priority being to cut blast-furnace overcapacity, expand electric-arc furnace steelmaking and then move toward hydrogen metallurgy.<\/p>\n\n\n\n<p>\u201cThere is already overcapacity,\u201d she added. And since both blast furnaces and DRI-EAF use steel scrap for production, \u201cif blast furnaces are cut back, there will be more scrap available for electric-arc furnaces. When steel prices normalise [with less supply], market returns and policy support will then make hydrogen DRI-EAF commercially attractive\u201d.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-demand-still-an-issue-for-green-steel\">Demand still an issue for green steel<\/h2>\n\n\n\n<p>China remains the world\u2019s largest steel producer, with about <a href=\"https:\/\/worldsteel.org\/media\/press-releases\/2026\/december-2025-crude-steel-production-2025-global-crude-steel-production\/\">960 million tonnes<\/a> of crude steel being produced in 2025. However, research firm Wood Mackenzie has <a href=\"https:\/\/www.woodmac.com\/press-releases\/china-steel-overcapacity\/\">estimated<\/a> the country already has more than 50 million tonnes of excess capacity, and that figure could rise to 250 million tonnes by 2035.<\/p>\n\n\n\n<p>While production has broadly levelled off, China\u2019s crude steel output <a href=\"https:\/\/www.reuters.com\/world\/asia-pacific\/china-crude-steel-output-hits-seven-year-low-2025-despite-record-exports-2026-01-19\/\">fell to a seven-year low<\/a> in 2025 as the continued downturn in the country\u2019s property and construction sectors hit demand. Steel exports, meanwhile, accounted for 12% of last year\u2019s production, but have kept rising: shipments increased by <a href=\"https:\/\/www.reuters.com\/world\/asia-pacific\/chinas-steel-exports-iron-ore-imports-hit-record-highs-2026-01-14\/\">7.5%<\/a> in 2025 to reach record highs, after increasing 22.7% in 2024 from 2023. This surge has now met with <a href=\"https:\/\/gmk.center\/en\/infographic\/62-countries-implemented-207-restrictions-against-steel-products-from-china\/\">protectionist measures<\/a> from over 60 countries.<\/p>\n\n\n\n<p>Among those exports, <a href=\"http:\/\/www.csteelnews.com\/qypd\/ywjx\/202507\/t20250723_102237.html\">10,000 tonnes<\/a> of hydrogen-produced steel from HBIS\u2019s Zhangjiakou facility were bought by an Italian client.<\/p>\n\n\n\n<a class=\"wp-block-cd-related-news alignright block--related-news loading\" data-post-id=\"60125092\"><div class=\"block--related-news__image\"><\/div><div class=\"block--related-news__content\"><span class=\"block--related-news__heading\">Recommended<\/span><span class=\"block--related-news__title\"><\/span><\/div><\/a>\n\n\n\n<p>Wang said this proves green steel has a market, but \u201cwhile foreign markets can serve as pioneers\u201d, China\u2019s domestic market is \u201cthe market we should pay more attention to\u201d.<\/p>\n\n\n\n<p>She added that other countries, similar to China, tend to prioritise support for their own steel industries for national security and employment reasons, meaning China\u2019s vast amount of production still needs to be \u201cdigested in the domestic market\u201d. The key, she said, is \u201cmatching upstream green steel production and downstream demand\u201d.<\/p>\n\n\n\n<p>\u201cNot every steel plant can simply be built next to a hydrogen pipeline,\u201d Wang said. \u201cSubsidies can help, but they cannot carry the industry forever, and if downstream steelmakers and buyers do not genuinely want low-carbon steel, the cost still has to be borne somewhere.\u201d<\/p>\n\n\n\n<p>Shen also pointed to demand as the bottleneck, \u201ceven though hydrogen supply is also a challenge\u201d. Despite signs of growing demand for green steel from the transport sector, such as an <a href=\"https:\/\/asiareengage.com\/wp-content\/uploads\/2024\/12\/Autos-Buildings-Renewables_Finding-Chinas-Green-Steel-Buyers-1.pdf\">agreement<\/a> between Baowu and automaker Chery, Shen said \u201cthis looks more like strategic positioning and supply-chain experimentation than a deep, market-clearing demand pool\u201d.<\/p>\n\n\n\n<p>Nevertheless, she stressed that the \u201cfuture of hydrogen\u201d should still be in China, thanks to the \u201cforeseeable low cost for hydrogen production\u201d, and as China has \u201csuch a complete upstream and downstream supply chain\u201d crossing chemical, metallurgy, transport, and manufacturing.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The new five-year plan and a pilot scheme signal China is getting serious about green hydrogen, with steelmaking among the sectors that may benefit<\/p>\n","protected":false},"author":50000909,"featured_media":60131401,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[757],"tags":[18132,580,50040327],"hashtags":[],"country":[20000110],"class_list":["post-60131373","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-energy","tag-hydrogen","tag-policy","tag-steel","country-china"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.0 (Yoast SEO v26.0) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>China\u2019s new hydrogen push could be a step towards cleaner steel | Dialogue Earth<\/title>\n<meta name=\"description\" content=\"The new five-year plan and a pilot scheme signal China is getting serious about green hydrogen, with steelmaking among the sectors that may benefit\" \/>\n<meta name=\"robots\" content=\"index, follow, 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