Data indicates that in the first quarter of this year, Sichuan's clean energy sector demonstrated significant strength, with hydrogen production increasing by 120% year-on-year. On May 11th, production lines at Chengdu Junano New Material Technology Co., Ltd. (Junano Tech) came to a temporary halt. The reason was not a lack of orders, but rather an overwhelming number of them, necessitating an upgrade of the production lines to meet the surge in demand.
"Previously, with smaller order volumes, we could manage with small-batch production. Now, with orders rising substantially, we must repackage our equipment to achieve mass production," explained Han Yonggang, the company's General Manager. He is currently overseeing the production line upgrades while also actively sourcing and evaluating new equipment. By the end of this year, the company plans to add two new production lines to accommodate larger-sized products.
This scenario reflects the robust growth of Sichuan's hydrogen energy industry. In Q1, the province's hydrogen output surged by 120% year-on-year. The sustained increase in downstream demand is driving strong production and sales for upstream hydrogen production equipment manufacturers. As a leading domestic producer of electrolyzer electrode materials, Junano Tech saw its orders and sales nearly double year-on-year in Q1, with a notable increase particularly in large, high-quality orders, according to Han Yonggang.
An electrolyzer is the core equipment for producing hydrogen via water electrolysis, and its electrode material acts as the "heart" of the system, directly determining hydrogen production efficiency. Back in 2022, the company established China's first mass-produced, standardized green hydrogen electrode production line in Pengzhou. However, the past two years were challenging for the industry. Fierce "involution-style" competition drove the unit price of electrolyzers down from 5.5 million yuan per unit to a range of 2.5 to 3.5 million yuan. Instances even occurred where companies won bids with low prices only to abandon them later, as the quoted prices fell below cost, Han Yonggang admitted.
This year, the industry is benefiting from favorable policies. The "15th Five-Year Plan" outlines hydrogen energy as a key future industry and a new economic growth driver. In March, the state launched a comprehensive hydrogen energy application pilot program, offering city clusters up to 1.6 billion yuan in subsidies over four years. This clear policy direction has shifted market expectations positively. Concurrently, the global energy crisis has accelerated the development of the hydrogen energy industry.
From a downstream demand perspective, hydrogen energy is primarily used in the chemical and refining sectors. "The production of green methanol and green ammonia using green hydrogen is the core focus for 2026," Han Yonggang explained. Ammonia is a fundamental chemical raw material used in fertilizer production and extends to industries like manufacturing, refrigeration, electronics, and energy. Methanol is widely used in chemicals and clean energy, serving as fuel for vehicles and ships.
Beyond policy and market forces, robust technology is the foundation for companies to capture market share. Junano Tech is advancing three technical pathways simultaneously: alkaline water electrolysis, PEM (Proton Exchange Membrane) electrolysis, and AEM (Anion Exchange Membrane) electrolysis. The alkaline route currently dominates the market, accounting for over 90% share due to its lowest cost, though it has relatively lower hydrogen production efficiency.
Junano Tech has achieved a breakthrough in this mainstream alkaline technology. Its self-developed and produced JA series alkaline electrodes have achieved a maximum current density of 12,000 A/m², filling a domestic technological gap for electrodes with a current density in the ten-thousand-ampere range (10,000 A/m²). This makes the company the world's second electrode supplier with such capability. The product cost is only one-third that of imported alternatives, with hydrogen production capacity three times higher than traditional electrodes and overall energy consumption reduced by over 10%.
Han Yonggang picked up a finished electrode, its surface uniformly coated with nano-catalysts resembling fine velvet. This coating is the result of a slow 4-hour "growth" process in a tunnel furnace and represents the company's core proprietary process. "The morphology, loading amount, and uniformity of the catalyst are key to performance, all dependent on precise temperature control and process formulation," he noted.
Leveraging this technological advantage, Junano Tech's parent company, Shanghai Junano New Material Technology Co., Ltd., secured an exclusive strategic investment from CATL in March. The company has also successfully secured orders from leading international electrolyzer manufacturers. "Currently, domestic orders account for 90% of our business. We are confident that overseas orders will reach 50% in the future," Han Yonggang stated.
A well-developed industrial ecosystem also creates growth opportunities for the company. Sichuan has established a complete hydrogen industry chain encompassing production, storage, transportation, refueling, and application, leading the nation in technology, products, and market adoption. Pengzhou, in particular, has formed an industrial cluster and become Sichuan's largest hydrogen production base.
"Sichuan possesses abundant hydropower and photovoltaic resources, providing a natural advantage for developing green hydrogen," said a relevant official from the Sichuan Provincial Department of Economy and Information Technology. In recent years, Sichuan has continuously expanded hydrogen application scenarios, collaborating with Chongqing to build the "Chengdu-Chongqing Hydrogen Corridor" and promoting hydrogen fuel cell vehicle demonstrations in ten cities including Chengdu, Panzhihua, and Deyang, thereby broadening the market for enterprises.
"Our customers are right at our doorstep, and supply chain collaboration is convenient and efficient," remarked Han Yonggang. He believes that driven by policy, demand, and technology, the hydrogen energy industry is entering a new phase of "scalability and commercialization." The company aims to achieve over 50% year-on-year sales growth this year.
(Images provided by Junano Tech)
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