The country has substantially increased its renewable capacities

China has begun construction of a large-scale green hydrogen project that will use solar and wind power in the Inner Mongolia Autonomous Region, according to Sinopec Group, the country’s biggest oil refiner.

The company expects the project, its second green hydrogen enterprise, to produce 30,000 tons of green hydrogen and 240,000 tons of green oxygen annually.

According to Xu Zhendong, executive director of the Inner Mongolia branch of Sinopec Star Petroleum, the green hydrogen and green oxygen produced there will be transported via pipelines to a pilot coal deep-processing project to replace part of what is produced using the existing coal-to-hydrogen method.

Inner Mongolia is currently one of China’s biggest coal-mining regions but is set to become a renewable energy hub. Although China still relies heavily on its large coal industry, it is hoping to make a gradual transition to renewable alternatives and achieve decarbonization over the coming decades. The country is planning to become carbon neutral by 2060 following a peak in carbon emissions in 2030.

Hydrogen is considered green since it is produced from renewables, such as solar and wind sources, and does not result in carbon dioxide emissions.

After becoming fully operational, the project is expected to reduce annual carbon dioxide emissions by some 1.43 million tons. That is equivalent to planting around 825,000 trees, according to Xu.

China is the world’s largest producer of hydrogen, though most of it is currently produced from coal. The country’s annual output is expected to reach up to 200,000 tons of hydrogen – thanks to renewables – in order to cut carbon dioxide emissions by up to two million tons by 2025.