China aims to become carbon neutral by 2060. According to a rare assessment by Royal Dutch Shell, achieving this goal will require the country to triple its electricity generation – from 23% of total energy today to 60% by 2060. This article summarizes Shell‘s key findings, including timelines for renewable energy growth, the role of hydrogen, and carbon price projections.

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1. Why Shell’s Assessment Matters

Shell is one of the largest global investors in China‘s energy sector. Its business covers gas production, petrochemicals, and a retail fuel network. As a leading supplier of liquefied natural gas (LNG), Shell has recently expanded into low‑carbon businesses such as hydrogen power and electric vehicle (EV) charging.

Therefore, Shell’s assessment provides an authoritative, data‑driven view of what China must do this decade to stay on track for its 2060 carbon‑neutrality goal.

China has officially pledged to peak emissions by 2030, but has not yet released a detailed carbon roadmap for 2060. Shell fills that gap with specific projections.

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2. Key Projections for China’s Energy Transition

2.1 Electricity Generation to Triple

Indicator	2020	2060 (Forecast)
Electricity generation (exajoules, EJ)	20 EJ	>60 EJ
Electricity as share of total energy	23%	60%

Therefore, China must build massive new renewable power capacity and modernize its grid.

2.2 Solar & Wind Will Surpass Coal by 2034

• Currently, solar and wind account for only 10% of China’s electricity.
• Shell expects that share to rise to 80% by 2060.
• 2034 is the tipping point when solar and wind will overtake coal as China’s largest electricity sources.

2.3 Hydrogen to Scale from Negligible to 17 EJ

Hydrogen will play a critical role in decarbonizing heavy industry and long‑distance transport.

• 2060 hydrogen use: 17 EJ (equivalent to 580 million tonnes of coal)
• Over 85% of that hydrogen will be produced via electrolysis powered by renewable and nuclear electricity.
• Hydrogen will meet 16% of total energy use in 2060, with heavy industry and long‑distance transport as top users.

2.4 Carbon Price to Rise Sharply

Year	Carbon Price (RMB per tonne)
2030	300
2060	1,300

A rising carbon price will incentivize emissions reduction across all sectors.

2.5 Nuclear & Biomass with Niche Roles

• Nuclear and biomass will have smaller but important roles in power generation.
• Biomass with CCUS (carbon capture, utilization, and storage) will provide a source of negative emissions for the rest of the energy system from 2053 onward.

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3. What China Must Do This Decade

According to Shell’s chief economist Mallika Ishwaran, early and systematic action is essential. Key priorities include:

• Investing in a reliable and renewable power system – massive expansion of wind, solar, and grid infrastructure.
• Demonstrating low‑carbon technologies – hydrogen, biofuel, and CCUS for heavy industry transformation.
• Implementing a strong carbon pricing mechanism – rising from 300 to 1,300 RMB/tonne by 2060.
• Ensuring environmental and social benefits – the transition can deliver better outcomes for citizens while helping the global fight against climate change.

“With early and systematic action, China can deliver better environmental and social outcomes for its citizens while being a force for good in the global fight against climate change.”
– Mallika Ishwaran, Chief Economist, Shell International

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4. Implications for Businesses and Investors

Shell‘s forecast signals major opportunities in:

• Renewable energy equipment – solar panels, wind turbines, inverters, transformers.
• Hydrogen production and distribution – electrolyzers, storage, pipelines.
• Grid modernization – smart grids, substations, high‑voltage transmission.
• Carbon management – CCUS technologies, carbon trading platforms.
• Electric vehicle infrastructure – charging stations, power electronics.

Therefore, companies supplying power infrastructure – including transformer manufacturers – can expect growing demand in China’s decarbonization drive.

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5. Summary Timeline

Year	Milestone
2030	Carbon emissions peak; carbon price = 300 RMB/tonne
2034	Solar + wind surpass coal as largest power sources
2053	Biomass + CCUS begin providing negative emissions
2060	Carbon neutral: electricity tripled, 80% solar/wind, hydrogen at 17 EJ, carbon price = 1,300 RMB/tonne

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