The Yumen Oilfield was once the heart of China’s petroleum industry. Before the founding of the People’s Republic of China in 1949, it accounted for 95% of the country’s total crude oil production, according to a report by China Petroleum Daily.
Since oil first flowed from Well No. 1 at the Laojunmiao site in August 1939, 85 years have passed. Today, the Yumen Oilfield operates as a modern energy hub, combining oil, gas, electricity, and hydrogen production.
“This shift reflects China’s green and low-carbon energy goals,” said Wei Fulei, director at the Centre for Finance, Trade, and Industrial Development under the China Development Institute, in an interview with the Global Times .
Wei, an expert in low-carbon economics, highlighted China’s leadership in energy transformation and renewable energy technology innovation.
According to the 2024 Oil and Gas Industry Development Report by the CNPC Economics & Technology Research Institute, China’s oil consumption is expected to peak in 2025. The country’s push for renewable energy is projected to stabilize global energy supplies while helping address climate change.
Han Wenke, former director of the Energy Research Institute under the National Development and Reform Commission, emphasized that China has developed a green energy strategy that aligns with its unique conditions. “This is one of the key achievements in China’s journey towards low-carbon energy,” he said.
Green Energy China
“China’s commitment to its green energy transition is unwavering. Policies remain consistent, and actions are becoming more robust. It’s a determined and bold effort,” Han told the Global Times .
As the world faces rising temperatures, transitioning to green, low-carbon energy is no longer optional—it’s essential. But why has China emerged as a leader in renewable energy?
A 2024 article by Yale University’s School of the Environment credited strong government policies as a major driver. “China’s planners sought investments that would foster technological advancements while cleaning up the environment and contributing to global emission cuts,” the article stated.
Years ago, China began crafting a comprehensive strategy for energy transformation, focusing on policy, technology, industry, and consumption. Today, the outcome is clear: the world’s largest carbon market and clean energy system.
China has pledged to peak carbon emissions by 2030 and achieve carbon neutrality by 2060. Since 2016, energy use limits and intensity reductions have become mandatory for local governments, according to Xinhua News Agency .
Many industries, including petrochemicals, are aligning with these goals. For example, the Sinopec Jinan Company in Shandong Province has embraced green production practices.
Originally built in 1971 in Jinan’s industrial zone, the refinery was absorbed into the city as urban areas expanded. In 2018, Sinopec announced plans to create a green enterprise focused on clean, low-carbon, and recycling principles.
Zero Waste Factories
To meet these goals, Sinopec Jinan has introduced eco-friendly production audits, upgraded oil quality, and implemented its green enterprise action plan. The company also invested almost 1 billion yuan ($138 million) between 2016 and 2020 to reduce pollution and emissions.
A few years ago, the refinery launched its “green water and blue sky” project, which ensures treated wastewater meets standards suitable for fish. By October 2024, it became one of Jinan’s first “zero-waste factories” through enhanced waste management, resource efficiency, and advanced systems for flue gas and wastewater treatment.
While coal remains a dominant energy source in China, oil also plays a significant role. Ma Jun, director of the Institute of Public and Environmental Affairs in Beijing, stressed the importance of policy in peaking oil consumption. Programs supporting renewable energy expansion and carbon reduction have been instrumental.
Ma added that China’s approach combines emission cuts, pollution control, and high-quality development. Strong policies have driven innovation, supporting sustainable growth and the gradual decline in oil consumption.
A Growing Renewable Energy Sector
One major reason for the shift away from oil is the rapid development of the renewable energy sector.
On August 9, 2023, Shenzhen became a global hub for new energy vehicles (NEVs). That evening, Chinese automaker BYD celebrated producing its 5-millionth NEV, a milestone in the industry. “It took 20 years to prove that BYD, new energy, and Chinese automobiles can succeed,” said Wang Chuanfu, the company’s chairman and president.
In July 2024, NEV sales in China surpassed traditional fuel cars in monthly retail sales for the first time—a key moment in the transition to green transportation. That year, China’s NEV production and sales reached over 12.8 million units, maintaining its global leadership for the 10th consecutive year, according to Xinhua.
China’s NEV industry highlights the country’s manufacturing capabilities while contributing to global emission reductions. Beyond transportation, industries like manufacturing and construction are also key targets for improving energy efficiency.
Across China, green innovations are flourishing. In Zhejiang Province, a local resident’s desk lamp is powered by hydropower generated just milliseconds earlier at Baihetan Hydropower Station, 1,700 kilometres away. In Dunhuang, Gansu Province, the city relied entirely on wind and solar power for 247 days in 2024.
Elsewhere, in Shaanxi Province’s Loess Plateau, solar panels shine over greenhouses growing vegetables like cucumbers and tomatoes, combining sustainable energy with agriculture.
A 2024 white paper on energy transition from the State Council Information Office outlined China’s efforts to modernize production, adopt energy-efficient technologies, and support industries in improving energy management. Over the last decade, energy use per unit of industrial output has dropped by more than 36%, while renewable energy capacity has grown dramatically.
In 2024, renewable energy accounted for 86% of China’s new power installations. Solar, wind, hydropower, and biomass saw significant growth, with solar power alone adding 278 million kilowatts.
Staying the Course
China’s commitment to its energy goals remains steadfast. “Despite global challenges, China’s policies have stayed focused. Its energy transition plans are now central to long-term development strategies,” Han told the Global Times .
While Europe faces energy challenges due to the Russia-Ukraine conflict and the U.S. has experienced policy shifts, China has made steady progress. Peaking oil consumption is a significant milestone, but other goals, like capping coal consumption and expanding renewable energy, remain on the horizon.
Ma Jun emphasized the need for the oil industry to embrace decarbonization, including Carbon Capture, Utilization, and Storage (CCUS) technologies. Oil companies must also leverage their expertise in pollution control to support environmental goals.
China’s experience is influencing global energy and emission reduction strategies. A 2024 report by the International Renewable Energy Agency (IRENA) highlighted China’s success in surpassing renewable energy targets. The report predicted that 60% of the world’s new renewable energy capacity through 2030 would come from China.
