Driving Low-Carbon Transformation in Industrial Energy Use: The Role of Green Microgrid Development

Decoding the New Era: How Can the Construction of Green Microgrids Promote Low-Carbon Transformation in Industrial Energy Use?

On January 16, 2026, the Ministry of Industry and Information Technology, along with four other departments, jointly released the “Guidelines for the Construction and Application of Industrial Green Microgrids (2026-2030)”. This initiative aims to transform industrial enterprises and parks from being mere energy “consumers” into integrated “producers-consumers” that engage in energy production, consumption, storage, and trading, thereby enhancing energy efficiency and reducing carbon emissions in key industrial sectors.

As a major industrial nation, China’s industrial sector has long dominated the energy consumption landscape, characterized by substantial energy consumption and an imbalanced structure. In 2024, electricity consumption in the industrial sector is expected to account for over 60% of the total electricity consumption across the country. The development of industrial green microgrids is viewed as a critical pathway for reducing industrial carbon emissions and achieving green, low-carbon growth.

So, what exactly is an industrial green microgrid? It functions like a small green energy system for factories and parks, capable of generating and storing green electricity while interacting collaboratively with the larger power grid. Liu Yongdong, Deputy Secretary-General of the China Electricity Council, explains that “industrial green microgrids can significantly enhance the matching capability between energy sources and loads, improve the local consumption of clean energy, and increase operational resilience, thereby strengthening the energy security and market competitiveness of enterprises.”

Located in Changzhou, Jiangsu, the Borui Power Plant features a rooftop equipped with photovoltaic panels covering 90,000 square meters, with eight integrated energy storage cabinets operating in harmony. The energy management center continuously updates real-time data on power generation and load curves. This intelligent microgrid generates an average of 25,000 kWh of solar energy daily; the energy storage cabinets employ a “valley charge peak discharge” strategy, saving approximately 5,000 yuan per month in electricity costs.

Green microgrids are accelerating the integration of low-carbon development into industrial transformation. Currently, there are over 300 operational industrial green microgrid projects across the country, with ongoing breakthroughs in relevant technologies and equipment. However, the overall development is still in the pilot and demonstration stages, facing challenges related to technical standards, market mechanisms, and collaboration with the larger grid.

The guidelines outline a series of deployments regarding construction principles, main content, construction models, application scenarios, and requirements, providing a clear roadmap for the development of industrial green microgrids over the next five years.

Focusing on the facility system, the guidelines aim to solidify the foundation for the development of industrial green microgrids:

• The proportion of self-consumed renewable energy generation should not be less than 60% annually.
• Maximize the use of by-product gases and excess heat from industries like steelmaking.
• Orderly develop integrated hydrogen production and utilization projects in regions abundant in wind and solar energy.

New energy storage technologies are crucial for enabling the temporal and spatial transfer of energy and supporting power needs in industrial green microgrids. Wang Chengshan, an academician of the Chinese Academy of Engineering and professor at Tianjin University, states that the guidelines propose a precise approach of “configuring according to functional needs,” allowing for the selection of appropriate energy storage forms based on differentiated requirements, and encouraging the innovative application of new technologies such as sodium-ion batteries and thermal energy storage.

Digitization is a key technological pathway for the carbon management system in industrial green microgrids. Currently, many energy management platforms have limited functionalities and lack intelligent forecasting, optimization scheduling, and carbon management capabilities.

Industry experts believe that the guidelines clearly advocate the application of advanced technologies like artificial intelligence, big data, and industrial internet to enhance energy efficiency optimization, carbon management, and load management functions. This will provide platform support for industrial enterprises and parks to achieve zero carbon emissions and improve environmental benefits. Furthermore, establishing a unified interface with grid dispatch platforms will ensure real-time information sharing, laying the groundwork for deeper engagement of industrial users with the power grid.

To stimulate diverse investment, the guidelines propose innovative construction models:

• The self-financed construction model allows industrial enterprises or parks to independently invest and operate, suitable for entities with concentrated energy use and stable loads.
• The third-party co-construction model involves collaboration between enterprises and service providers through contract energy management and similar methods. These two models consider the operational characteristics of different entities and are expected to accelerate the dissemination of industrial green microgrid technologies.

Additionally, the current revenue model for industrial green microgrids in the electricity market is relatively singular. The guidelines suggest exploring the participation of industrial green microgrids as new operational entities in electricity market transactions to enhance the economic benefits of system operations. Liu Yongdong believes that maintaining a market-driven approach will promote the transformation of industrial green microgrids from “energy users” to “resource entities,” actively expanding diversified revenue channels and shortening investment payback periods.

According to Wang Chengshan, “The guidelines serve as a strong and practical guiding document for the industrial green microgrid sector in China, providing not just technical guidance but also industrial policies to guide investment, stimulate vitality, and cultivate a new quality of productive capacity.” The implementation of these guidelines is expected to accelerate China’s industrial low-carbon transformation, enhance green competitiveness, and support the establishment of a new power system as well as the achievement of dual carbon goals.