In the current context of intensified international geopolitical conflicts, rising risks of global shipping lanes, rising trade protectionism, and increasing uncertainty in external energy supply chains, the significance of green fuels has gone beyond emission reduction itself.

Recently, green fuel-related policies have been frequent. This year's government work report proposed "cultivating new growth points such as hydrogen energy and green fuels"; on March 3, the National Energy Administration held a symposium on the development of the green fuel industry, clearly pointing out that the development of the green fuel industry "is conducive to replacing oil and ensuring energy security"; On March 16, the three departments jointly issued the "Notice on Carrying out Pilot Work on Comprehensive Application of Hydrogen Energy", proposing to promote the expansion of hydrogen energy applications from fuel cell vehicles to transportation and industry.

Green fuel fills the key short board

Green fuel is not only a form of green hydrogen, but also a series of fuel products driven by renewable energy, such as green ammonia, green methanol and sustainable aviation fuel (SAF). Compared with primary energy such as wind power and photovoltaic, the biggest difference of green fuel is not only "greener", but also "more storable, more transportable and more alternative". It essentially converts the fluctuating green electric energy into energy commodities that can be stored, transported, deployed across regions, and can enter industrial and transportation terminals. Therefore, green fuel is not a new energy supplement in the general sense, but an important intermediary form that transforms resource advantages into actual supply capacity.

From an energy security perspective, green fuels fill at least three key gaps. First, it helps to make up for the natural limitations of new energy "strong production, weak storage and transportation. China's energy resource endowment and load center space mismatch is obvious, relying solely on local consumption and grid transmission, and can not completely solve the long-term energy storage, long-distance transportation and cross-regional allocation problems. Second, it helps to make up for the realistic constraints of difficult electrification in key terminal sectors. Chemical, steel, ocean shipping, aviation, heavy transportation and other fields still have a strong dependence on liquid and gas fuels, and it is difficult to complete deep substitution by electrification alone. Third, it will help to make up for the fragile links of the traditional energy security system, which are highly dependent on foreign countries and weak in transportation resilience, and transform domestic renewable energy resources into strategic capabilities that can guarantee supply across time and space.

From the perspective of real progress, green fuel has entered the actual deployment stage in some key terminals. In April 2024, Shanghai Yangshan Port completed the first domestic green methanol "ship-to-ship" simultaneous filling; by March 2026, Shanghai Port's cumulative green methanol filling volume has ranked among the world's major ports. In the field of civil aviation, the Civil Aviation Administration has launched a pilot application of sustainable aviation fuel in 2024, which will be carried out in two stages, the second of which will cover the whole year of 2025, focusing on fuel supply guarantee, oil quality monitoring, effect evaluation and mechanism standard construction. This shows that green fuel in shipping, aviation and other key scenarios to accelerate the eve of large-scale application.

However, it should also be noted that the key problem of the current green fuel is not only the high cost, but also the lack of a systematic development framework for energy security. In the past, many places promoted green hydrogen, green ammonia, green alcohol projects, more from the perspective of industrial cultivation, investment promotion and low-carbon demonstration, the safety attribute is not prominent enough.

Development should take into account security, industry and market

The key to promoting green fuel development from the perspective of energy security is to form a systematic framework for promoting green fuel development that takes into account security, industry and market as soon as possible. In the next stage, we should focus on the following directions.

First, green fuels should be clearly included in the national energy security strategy and the overall plan of the "15th Five-Year Plan" energy system. Green fuel can no longer be regarded as an extension of the new energy industry chain, but should be placed in the overall consideration of oil and gas substitution, strategic reserves, supply protection in key industries, supply chain resilience and new energy system construction, and accelerate its promotion from low-carbon technology options to an important support for national energy security capacity building.

Second, promote the division of labor and orderly layout of different green fuels on demand, and build a green fuel system with diversified and coordinated development. Green hydrogen, green ammonia, green methanol and SAF is not a simple substitution relationship, but should be based on different application scenarios to form a differentiated division of labor. High-purity hydrogen is more suitable for raw material substitution and some industrial scenarios, green ammonia is more suitable for large-scale storage and transportation and some chemical and shipping scenarios, green methanol has more realistic advantages in liquid storage and transportation and terminal adaptation, and SAF is directly oriented to decarbonization and fuel substitution in the aviation sector. We should adhere to the scene traction, classification policy, and promote all kinds of green fuels in the advantages of the field of each exhibition, collaborative development.

Third, establish a value realization mechanism for green fuels as soon as possible. The development of green fuels cannot rely on a single subsidy for a long time. Instead, it should accelerate the integration of green certificates, green electricity trading, carbon markets, long-term procurement agreements, green certification and government guidance mechanisms, and promote the gradual transformation of environmental value, substitution value, safety value and industrial value into quantifiable, tradable and cashable benefits through institutional arrangements, so as to truly open up the key link from demonstration to large-scale development.

Fourth, optimize the spatial layout and build a national green fuel supply network. Coordinate and promote the construction of green fuel production, storage and transportation, filling and consumption system. Resource-rich areas focus on green fuel production functions, coastal ports and integrated transportation hubs to speed up the improvement of storage and transportation transfer and filling capacity, key industrial areas and transportation nodes to give priority to the cultivation of large-scale consumer markets. At the same time, the overall layout of geological hydrogen storage, gas storage and other underground energy storage resources, strengthen the green fuel and natural gas reserves, regional peak adjustment and emergency supply system of collaborative convergence, and gradually form a production base, transportation channels, reserves have support, consumption has a scene of the national supply network.

Fifth, speed up the convergence of standard certification with international rules, and enhance the initiative in international competition for green fuels. In the future, green fuels will not only serve domestic substitution, but will also be increasingly embedded in international trade and international transport systems. Whoever first forms a verifiable, verifiable, traceable and tradable standard system is more likely to take the initiative in the new round of green shipping, green aviation and green industrial chain reconstruction. We should adhere to the domestic and international docking, accelerate the improvement of standards, certification system and rule design, and strive to enhance China's institutional voice in the global green fuel industry chain, supply chain and value chain.

Author: Xu Chuanbo, Liu Jiyuan, School of Economics and Management, North China Electric Power University