The district offers up to 10 million yuan to companies in R&D or building a plant in the industrial zone.

A new hydrogen energy vehicle industrial zone, Jiading Hydrogen Park, was set up in Anting Town in Jiading District on Monday.

The district has preferential policies to attract hydrogen energy research institutes as well as companies, offering up to 10 million yuan (US$1.44 million) for R&D or manufacturing bases.

Jiading is well-known for its automobile industry. Last year, 72.9 percent of the district’s output came from the car business. Lu Fangzhou, director of the district, said GDP generated by the hydrogen vehicle industry is expected to reach 50 billion yuan by 2025.

The district now has a mature industrial chain from gas-filling stations to battery manufacturing and it will now push the development of hydrogen vehicles.

When people talk about new energy, they are often referring to electricity or fuel cells. Gan Ping from Shanghai Science and Technology Commission said few have focused on hydrogen batteries. But that is changing.

“China plans to build 300 hydrogen-filling stations to support 50,000 hydrogen fuel cell vehicles by 2025,” said Cai Ning, director of Jiading’s economy commission. “Shanghai is making plans for hydrogen-filling stations.”

The number of hydrogen fuel cell vehicles in China is expected to be 2 million by 2030.

“There is no regulation on hydrogen energy at national level,” said Gan, “so Shanghai can be a pioneer exploring new possibilities.”

SAIC Motors has invested more than 1 billion yuan in hydrogen vehicles, but a lack of filling stations is the key bottleneck. Cai told Shanghai Daily the goal for Shanghai is to have 3,000 hydrogen fuel cell cars by the end of 2020, most of them buses or other commercial vehicles.

Last year, 6 hydrogen fuel cell buses hit the road in Jiading and by the end of this year, there will be at least 6 hydrogen-filling stations in the district. One will open to the public while the others are for buses and research purpose.

Across the city, there are 285 hydrogen fuel cell vans doing logistics jobs for Alibaba and JD.com.