CITIC SEC has released a research report stating that the green fuel industry is crucial to national energy security and serves as a substitute for oil and gas. The sector has evolved from an optional decarbonization choice to a mandatory national strategy, offering clear growth potential. The valuation premium logic based on oil substitution and national energy security is expected to fundamentally restructure the underlying rationale for the wind power industry's development. The wind power sector is poised for a systematic upward shift in valuation benchmarks, a comprehensive transformation of its valuation system, and the complete removal of long-term growth ceilings, leading to a triple revaluation of its worth. Key viewpoints from CITIC SEC are as follows:
Green fuel development has been formally integrated into the national energy security and self-reliance strategic framework, marking a fundamental upgrade in policy level and enforcement. A special symposium held by the National Energy Administration in March 2026 clarified that green fuels are a key priority mandated by the Central Committee of the Communist Party of China and the State Council, to be coordinated and implemented by the National Development and Reform Commission and the National Energy Administration. The symposium emphasized that green fuels are integral to energy security strategy and oil substitution.
Positioned as a substitute for oil and aligned with the trillion-scale oil and gas demand, the sector's growth trajectory is clear. According to disclosures from the National Energy Administration, China's domestic production of industrial crude oil above designated size in 2025 was only 216 million tons, while crude oil imports totaled 578 million tons. Apparent crude oil consumption reached 791 million tons, with external dependence on crude oil rising to 72.7%, an increase of 0.7 percentage points year-on-year, indicating growing pressure for energy self-sufficiency. Calculations by Xiangchenghui Research Institute suggest that replacing all imported oil functions would require nearly 750 million tons of green fuels, including 702 million tons of green methanol and 46 million tons of sustainable aviation fuel (SAF). This would correspond to a need for 110 to 150 million tons of green hydrogen, requiring up to approximately 2,000 to 2,700 GW of new energy installation capacity. The market space is expected to expand from a billion-yuan niche segment to a trillion-yuan mainstream energy sector.
According to Xiangchenghui Research Institute statistics, as of the end of 2025, China's total planned capacity for green methanol (including signed agreements) reached 64.86 million tons, while the total planned capacity for SAF approached 8 million tons. If all these planned capacities are realized, they could substitute functions equivalent to 53.34 million tons of crude oil, accounting for 9.2% of crude oil imports in 2025. This would largely meet the phased target of replacing 10% of imported crude oil, indicating strong certainty for capacity realization and performance release over the short term of 2-3 years.
Wind power is positioned as "green oil drilling," embodying national security attributes. Wind power companies are transitioning into green fuel operators, with clear demand growth. As the core lever for oil substitution, wind power possesses the strongest essential demand attributes and is expected to see the most significant valuation increase. Previously valued as "heavy-asset new energy equipment manufacturers," wind power companies are now upgrading to "core operational entities for national energy security," with reasonable PE benchmarks anticipated to rise. Companies with wind power assets and high-quality wind resources exhibit significant cost advantages. Coupled with the logic of transitioning into green fuel operators, their valuations are expected to increase from the traditional wind power equipment manufacturing level of 20x PE to over 30-35x PE. Leading enterprises may achieve even higher valuation premiums, reaching up to 40x PE.
Investment strategy: Re-emphasizing the industrial trend of wind power companies transforming into green fuel operators. According to the bank's previous calculations, wind power, as the primary source of green electricity for green fuels, accounts for over 53% of the cost value. Wind power companies transitioning into green fuel operators possess cost advantages, with expectations for rising gross profit margins and a reshaping of valuation logic.
Risk factors include potential underperformance of national energy self-sufficiency strategies and slower-than-expected technological cost reductions in integrated green fuel projects.