At the 2026 Sustainable Global Leaders Conference held from October 20 to 22 at the Huangpu Expo Park in Shanghai, Luo Chao, General Manager of Innovation Business and Head of Strategy at Honeywell Technology and Process Solutions Group China, spoke at the "Energy and Power Sub-Forum on Sustainable Value Creation." He shared insights on the challenges and solutions facing the green energy industry.
Honeywell is a technology-driven company that does not own or invest in green hydrogen, green ammonia, or green methanol facilities, but rather positions itself as a technology provider offering cutting-edge technological support to customers, Luo explained. He pointed to an objective reality: green and low-carbon products carry a significant premium compared to traditional alternatives. Gray hydrogen costs approximately $1 per kilogram, while domestic green hydrogen costs at least $2 per kilogram, achievable only in northern regions with superior solar and wind conditions, representing a doubling of costs. Green methanol costs around 3,500 to 4,000 yuan per ton, compared to just over 1,000 to 2,000 yuan for conventional gray methanol. Conventional aviation kerosene costs about $1,000 per ton, while sustainable aviation fuel production costs can reach $3,000 per ton, and e-kerosene synthesized from carbon dioxide and green hydrogen can reach $8,000 to $9,000 per ton, currently having price but no market. Since hydrogen energy and aviation fuel are large-scale application categories, even a small cost increase creates enormous cost pressure.
In his view, technology, raw materials, production supply chains, and demand are four mutually reinforcing elements that cannot be viewed in isolation. From a technological standpoint, green hydrogen production costs mainly come from electrolyzer system investment depreciation and green electricity operating costs; without a decline in green electricity prices, green hydrogen costs are difficult to bring down. Honeywell can provide high-performance electrolyzer membrane materials such as proton exchange membranes and anion exchange membranes, helping customers reduce capital expenditure and operating expenditure through more durable and more efficient membrane products, achieving a 20% to 30% reduction in green hydrogen production costs. Since the bulk of green methanol and sustainable aviation fuel costs come from green hydrogen, lowering green hydrogen costs can activate the entire industrial chain.
Luo emphasized that building a complete industrial ecosystem is equally critical, as the supply chain is long and difficult for any single company to solve all challenges independently. On the demand side, China has introduced subsidies and other policies over the years to support the green hydrogen industry and stimulate demand. Honeywell, on one hand, leverages advanced technology to drive costs down, and on the other hand, as a participant in the industrial ecosystem, works with regulatory authorities and customers to fill gaps in the supply chain and promote the implementation of relevant standards, technical specifications, and application scenarios.
Beyond green hydrogen, Luo noted that Honeywell has already deployed multiple commercial-scale units in the sustainable aviation fuel sector. A domestic customer has implemented a million-ton-scale SAF facility using waste cooking oil as feedstock, and Honeywell's technology achieves feedstock conversion efficiency four to five percentage points higher than comparable commercial technologies on the market. Each one percentage point improvement in feedstock conversion efficiency can generate hundreds of millions of yuan in additional annual sales for customers, improving project investment returns, with related benefits also flowing through to downstream customers.
Luo added that beyond green hydrogen and green methanol, green olefins and e-kerosene are also areas of market interest, and Honeywell possesses globally leading technology reserves in the sustainable aviation fuel and e-kerosene tracks. Replacing gray hydrogen with green hydrogen alone can create doubled industrial value. He revealed that the company is advancing efforts to connect the entire industrial chain and plans to implement benchmark projects covering the full chain within the next one to two years, deploying Honeywell technologies in those projects.
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