Societe Generale Securities: Prospects for the hydrogen energy market and broad ecological value recommend green methanol production

The Zhitong Finance App learned that Societe Generale Securities released a research report saying that the plan for hydrogen energy to scale up during the 15th Five-Year Plan period is more clear. At the same time, it shows broad market prospects and ecological value, but an economical and sustainable business model is still a core barrier to the real commercialization of hydrogen energy. The opening up of the business model is expected to be pioneered in the field of green fuels. The bank recommended Goldwind Technology (02208,002202.SZ) and Sunshine Power (300274.SZ), which are expected to be the first to achieve economical production of green methanol.

Societe Generale Securities's main views are as follows:

The hydrogen energy industry is expected to enter a large-scale phase in the 15th five years

On October 28, the CPC Central Committee issued a proposal for formulating the 15th Five-Year Plan for National Economic and Social Development. Among them, it is clear that future industries are laid out in a forward-looking manner, exploring diverse technology routes, typical application scenarios, viable business models, and market regulation rules, and promoting emerging industries, including hydrogen energy, to become new economic growth points. Compared to the statement “organize and implement future industry incubation and acceleration plans to plan and lay out a number of future industries” during the 14th Five-Year Plan period, the plan for hydrogen energy to scale up during the 15th Five-Year Plan period is more clear.

The industry is at a critical point of commercialization, and downstream consumption scenarios are the key

The hydrogen energy industry chain covers the three core links of production, storage, transportation, and application, forming a multi-dimensional, cross-industry energy ecosystem. The production process of green hydrogen can effectively consume renewable energy and improve the efficiency of the use of clean energy such as wind power and photovoltaics. It shows broad market prospects and ecological value. However, an economical and sustainable business model is still a core barrier to the real commercialization of hydrogen energy.

Hydrogen consumption is concentrated in chemical, refining and other fields

In 2024, global annual hydrogen consumption in synthetic ammonia, synthetic methanol, refining and metallurgy, heating and other fields is about 32 million tons, 17.5 million tons, 43 million tons, and 13 million tons, respectively. Basically, all hydrogen energy is used as a raw material for industrial processes. In 2024, China's synthetic methanol and synthetic ammonia hydrogen consumption accounted for the top two hydrogen consumption segments, about 9.95 million tons and 9.5 million tons respectively, accounting for 27% and 26%; refining and coal chemical hydrogen consumption were about 6 million tons and 4.05 million tons, respectively, accounting for 16% and 11% of the country's hydrogen consumption. Other hydrogen consumption is distributed in various fields such as transportation, heating, and metallurgy.

The opening up of the business model is expected to be the first to open up in the field of green fuels

The International Maritime Organization (IMO) has approved draft amendments to Annex VI to the International Convention for the Prevention of Pollution from Ships (MARPOL). According to the draft, the direct compliance target for ships is to reduce emissions by 43% by 2035, and the basic target is to reduce emissions by 30%. Taken together, green methanol is the best alternative fuel for both cost and carbon reduction potential. Since 2025, various ministries and departments have introduced green fuel support policies one after another, and the economical opening of downstream green methanol is expected to drive the green hydrogen industry to scale up.

Hydrogen production recommendations focus on the accelerated development of green hydrogen preparation to drive equipment

Green hydrogen production relies entirely on renewable energy sources (such as wind power, photovoltaics, hydropower, etc.) to generate hydrogen gas through electrolyzed water. There are no carbon emissions throughout the entire process, from energy input to hydrogen production. The only by-product is water, which truly achieves a clean and low-carbon life cycle. Currently, hydrogen production from fossil energy is still mainstream. According to IEA data, the total global hydrogen production in 2023 is about 97 million tons, of which natural gas accounts for 2/3 of hydrogen production; coal accounts for about 20%; industrial by-production of hydrogen accounts for more than 15%, of which only less than 1 million tons of hydrogen emissions are low. It is estimated that by 2030, global low-emission hydrogen production will reach 49 million tons, of which hydrogen production from electrolyzed water accounts for 75%.

Hydrogen storage and transportation is an important barrier that currently limits the application of hydrogen energy

Hydrogen storage and transportation require the use of special technical means such as high-pressure gas and low-temperature liquid, which directly causes storage and transportation costs to remain high; on the other hand, infrastructure construction for hydrogen energy storage and transportation in China is not yet perfect, making it difficult to meet the needs of large-scale applications. Furthermore, the relevant policies and standards system for the hydrogen industry also need to be improved. The distribution of hydrogen resources in China shows a pattern of “more north and less south”. This distribution characteristic profoundly affects the layout of hydrogen energy demonstration applications. Currently, most of the demonstration projects revolve around industrial by-product hydrogen production sites and hydrogen production sites from renewable energy sources, and are concentrated within 200 kilometers of the production area. Pipeline transportation has become an important development direction due to its advantages of large transportation volume, long distance, and low energy consumption loss, but breakthroughs are still needed in key technologies.

Risk warning: downstream demand falls short of expectations, green hydrogen cost reduction falls short of expectations, fuel cell system cost reduction falls short of expectations, policy support falls short of expectations