As the government has been stepping up efforts to develop the country's hydrogen industry, with the development of hydrogen stations for new energy vehicles being included in the Government Work Report, many domestic companies have been actively pushing forward their hydrogen industry layout.

China Petroleum and Chemical Corp has said it will continuously lay out its hydrogen industry plans with related research on hydrogen fuel cells already being conducted, taking advantage of its extensive network of gas stations nationwide, together with the chemical by-products of the world's largest refiner.

The company, which owns the largest number of gas stations nationwide, will take advantage of its station network and mainly focus on the construction of hydrogen refueling stations for vehicles.

China Energy, which has the largest coal-to-hydrogen production capacity in China and globally, also said it would further promote the hydrogen energy. It has initiated and sponsored the China National Alliance of Hydrogen and Fuel Cell to promote low-cost hydrogen production, transportation, and the establishment of industry standards such as those regarding hydrogen refueling stations, said Ling Wen, president and CEO of China Energy.

Hydrogen energy is considered an "absolute clean" energy as water is the only by-product while being produced and consumed.

Analysts believe China, with an annual production capacity of more than 25 million metric tons currently as well as a huge hydrogen market demand due to the booming growth of new energy vehicles, has substantial potential in developing hydrogen energy, and China's development of hydrogen industry is also in accordance with the international strategy on energy transmission.

China currently has 15 hydrogen refueling stations with a hydrogenation capacity below 200 kilograms, and the reason for the infrastructure facilities lagging behind, according to insiders, is the high investment cost and the current limited demand for hydrogen.

Initial investment for a hydrogen station with hydrogenation capacity of around 200 kilograms is 10 million yuan, as key components including hydrogenation guns, pumps and valves are highly dependent on imports which are costly, said Wang Weimin, an expert with CNPC.

However, it is believed the hydrogen industry will have substantial capacity in the future, especially in transportation, including road and rail traffic, ships, space flight, logistics system and mining vehicles.

In response, automobile companies have been making hydrogen fuel cell electric vehicles a new focus for their business, with Great Wall Motor Co Ltd, one of the country's largest SUV and pickup manufacturers, having invested more than 1 billion yuan ($149 million) in the research and development of hydrogen energy and fuel cell vehicles.

China had around 1,200 fuel cell vehicles on its roads and fewer than 20 hydrogen fuel stations by the end of 2017, ranking behind the United States, Japan, Germany and South Korea, according to the International Hydrogen Fuel Cell Association.

The Chinese government has set a goal to have 5,000 such vehicles on its roads by 2020, 50,000 by 2025 and 1 million by 2030.