China builds 8 mil mt/y green fuel capacity in 2025: NEA report

China built around 8 million metric tons/year of green fuel production capacity on an oil-equivalent basis by the end of 2025, highlighting the country's accelerating push into low-carbon fuels for shipping, aviation and other hard-to-abate sectors, according to the National Energy Administration's first Green Fuel Development Report released Aug. 5.

China's green fuel capacity includes green methanol, green synthetic ammonia, sustainable aviation fuel, biofuels and biomethane, according to the report.

The country's green methanol production capacity reached about 380,000 mt/y in 2025, accounting for around 60% of global capacity, while green synthetic ammonia production capacity reached 700,000 mt/y, the report said.

Global green aviation fuel production surged 90% year over year to 1.9 million mt in 2025, with 68 projects operational worldwide totaling 5.8 million mt/y of capacity, the report said.

The report cited increasingly stringent emissions rules from the International Maritime Organization and the International Civil Aviation Organization (ICAO) as major drivers of global demand growth for low-carbon fuels.

The IMO's net-zero framework aims to reduce annual greenhouse gas emissions from international shipping by at least 70% from 2008 levels by 2040, while ICAO set a 5% carbon dioxide reduction target for 2030 through cleaner energy adoption.

China has established bunkering capabilities for the full range of green marine fuels, according to the report. In 2025, Chinese ports supplied about 150,000 mt of B24 biodiesel and more than 10,000 mt of green methanol to vessels.

Dalian Port completed the world's first green ammonia bunkering operation, while ports including Shanghai, Qingdao and Tianjin have conducted green methanol bunkering operations, the report also said.

China's sustainable aviation fuel capacity reached about 1.7 million mt/y by the end of 2025, according to the report. The country has expanded SAF pilot programs and completed SAF supply capability development at 10 major airports, enabling them to blend and supply sustainable aviation fuel.

The report underscores Beijing's growing focus on green fuels as part of its broader energy security and carbon-reduction strategy, after President Xi Jinping identified hydrogen and green fuels as future economic growth drivers and the government included green-fuel development in its annual work report for the first time in 2026.

Despite the rapid buildout, the report acknowledged that green fuel production costs remain about 1.5-2 times higher than conventional fossil fuels. It also cited international market uncertainty and the need for further advances in key technologies such as biomass gasification, flexible hydrogen-to-ammonia and methanol production and carbon dioxide hydrogenation.