China has been chosen as the site for the world's first plant for the production of fossil-free plastics from green methanol, reflecting among other factors the country's manufacturing strengths, commitment to green transformation, and promising development prospects, according to a top executive of Swiss-based fossil-free plastic company Vioneo.

China's manufacturing strength and its 15th Five-Year Plan (2026-30), which prioritizes green chemicals and industrial decarbonization, prompted Vioneo to bring its 1.5 billion euros ($1.74 billion) investment to China, said Alex Hogan, CEO of Vioneo, during a recent interview in Shanghai.

"China has shown strong commitment to sustainability, with the latest five-year plan supporting green methanol and zero-carbon technologies. That is one of the main reasons for coming here," he said.

According to Hogan, the world's first newly built plastics plant powered by renewable electricity and green methanol is expected to cut carbon dioxide emissions by about 1.5 million metric tons a year versus oil-based production, and the figure could double if coal is used as the raw material.

"We are at the beginning of the journey identifying China is the right place, because our feedstock sources are here. China is decades ahead of other regions on green methanol," he said.

The European chemical startup, owned by A. P. Moller Holding, announced in January that it would abandon plans to build the plant in Belgium and decided to invest in a similar project in China.

"We took a very conscious decision to put the first plant in China," said Katja Wodjereck, chief commercial officer of Vioneo, adding that the availability of green methanol at scale and on a competitive basis in the future was a big plus.

"Moving the first plant here is a supply chain decision and also a commercial decision, because that way we cannot make this even more — from the supply chain — closer to where our feedstock is," said Wodjereck.

"But we are also making this more cost-attractive, with a better supply chain and greater CO2 savings. It also opens up, which I find very interesting in my role, access to Asian customers in the future," she added.

According to Wodjereck, the future plant is expected to have annual capacity of about 200,000 tons of fossil-free polypropylene and 100,000 tons of fossil-free polyethylene.

"There are other reasons, but you need to look at what the most important ones are. The most important reason is to reduce the price of our final product, and the (15th) Five-Year Plan is stimulating the green ethanol market," said Hogan.

China's 15th Five-Year Plan outlined its commitment to comprehensively advancing green transformation at a faster pace, with the country's green and low-carbon industrial scale expected to double to exceed 20 trillion yuan ($2.94 trillion) by the end of 2030, CGTN reported.

The target of achieving carbon neutrality is not simply a commitment to cutting emissions, but also a profound transformation involving green buildings, zero-emission plants and industrial parks, green energy, green products and green trade, the report added.

Scheduled to officially begin production by 2030, Hogan said the company is still in talks over the final site selection and is expected to make a formal announcement in about one to two months.

"I'm counting on China speed. Everything I hear is that the country is amazing at delivering large-scale projects quickly, so maybe a little earlier than 2030," Hogan said.