China has entered a critical window for tightening project approvals, and investors need to stay alert. Since launching capacity governance reforms in July 2025, Shandong, Hubei, and Jiangsu have rolled out four new rules in just two months - matching the total for all of 2024.
- Small-scale projects squeezed: Jiangsu raised thresholds for chemical capacity, banning new low-end projects and pushing faster upgrades - a model likely to go nationwide.
- Energy-intensive projects face stricter scrutiny: Provinces like Shandong now require provincial-level approval for coal-fired power, as well as refining and petrochemical projects, favoring compliant majors poised to benefit from industry consolidation.
- Not one-size-fits-all: Fuel-quality upgrades and low-carbon retrofits that don't add new capacity may bypass some restrictions, offering near-term opportunities.
- Efficiency rules go global: New energy-intensive and high-emission projects must benchmark against international efficiency standards, opening room for tech-driven investment.
The full report dives deeper into:
- Key updates to provincial industrial restructuring catalogs
- Updates to energy-intensive and high-emission project lists
- Current status of China's refining and new materials markets
The above content is the major conclusions and highlights extracted from China (Energy Transition) Policy Perspective. To get detailed full text, send an email to glconsulting@mysteel.com.
