China's energy-intensive industries face 40% green power mandate by 2030

创建于05.07
China's green electricity market reached a milestone in Q1 2025, with nearly 2 trillion green electricity certificates (GECs) traded - roughly one-third of total historical volume. In April, the National Development and Reform Commission (NDRC), alongside other ministries, announced plans to expand mandatory green power consumption to a broader set of energy-intensive sectors. The petrochemical and chemical industries are now expected to accelerate their transition to green power, with a target to meet or surpass the national average share of green power in total electricity consumption (40%) by 2030.
 
Policy Focus: Expanding Binding Green Power Requirements
  • Target sectors: Petrochemicals, chemicals, steel, non-ferrous metals, building materials, and data centers (in 2024, only the aluminum sector faced mandatory targets).
  • Compliance benchmark: By 2030, the proportion of green power in total electricity consumption must meet or exceed the national average responsibility weight for renewable electricity consumption (CRW, estimated at 40% in 2021), with compliance performance verified through GECs.
 
>>>Implications for Power Demand
In the chemical sector alone (2022 electricity consumption: 546.1 billion kWh):
  • Raising the green power share from below 25% to 40% would create over 82 billion kWh of additional green power demand.
  • This is equivalent to 50% of China's total green power trading volume in 2024 and roughly twice Hainan's annual electricity consumption - highlighting the structural change of power consumption in power-intensive sectors.
 
Short-Term Headwinds: Cost Pressure Mounting
In Guangdong, the average green power trading price is 0.06 yuan/kWh higher than the coal-fired power benchmark. For the chemical sector, this implies an incremental annual cost of up to 4.9 billion yuan if 82 billion kWh of additional green power is procured.
New projects may also face stricter entry requirements. Provinces like Guangdong and Inner Mongolia already mandate that new data centers source at least 30% of power from green electricity. Similar restrictions may soon apply to new petrochemical and chemical investments.
 
Long-Term Upside: ESG Integration and Rating Lift
Green power consumption is expected to be incorporated into ESG (Environmental, Social, and Governance) disclosure frameworks. Accelerated adoption of clean electricity could enhance ESG ratings for petrochemical and chemical firms, improving access to capital and supporting long-term competitiveness.
 
GL Consulting Recommendations:
  • Develop a tailored compliance roadmap: 
  • Manage costs dynamically: 
  • Invest in flagship green projects: 
  • Learn Chinese Standards: China is pushing for international acceptance of its GECs, particularly from initiatives like RE100, while advancing Chinese standards as global benchmarks. 
0
 
In April, GL Consulting published a special edition of  China (Energy Transition) Policy Perspective Spotlight - U.S.-China Tariff War Hits Ethane and LPG Hardest, Spurs Uptick in Naphtha Demand, analyzing the key impacts of the latest U.S.-China tariff escalation.