Green Logistics Innovation for Emerging Markets Driving Competitiveness and Shared Value 2025

CASE STUDY 4 Geely Farizon’s green methanol strategy driving vertical integration to accelerate green transformation Overview: Geely, with its subsidiary Geely Farizon focused on new energy commercial vehicles, operates more than 50,000 vehicles and targets operational carbon neutrality by 2030 and life cycle carbon neutrality by 2045. Farizon has pursued innovation in green methanol and developed a complete industrial chain covering methanol production, storage, transport and filling, methanol vehicles and CO2 capture. Innovation levers applied: –Methanol production (lever 1): A 100,000-ton-scale green methanol project was launched in Anyang, Henan, establishing a circular production model that converts captured industrial emissions into low-emission methanol fuel. This innovative approach significantly reduces overall carbon emissions by repurposing industrial waste streams, creating a replicable model of circularity at scale. –Methanol-powered commercial vehicles (lever 3): In regions such as Gansu and Xinjiang, thousands of methanol commercial vehicles are used for local bulk commodities transport. –Methanol filling network (lever 7): Partnering with players such as PetroChina and Sinopec will help build a national network of 4,000 methanol refuelling stations by 2027. Most stations are being converted from existing fuel stations at a low cost of only CNY 50,000–100,000 (Chinese yuan). Impacts achieved: –Cost efficiency: Methanol vehicles are comparable in cost to traditional gasoline and diesel vehicles, but 25- 30% less than electric models. In particular, methanol vehicles have 32–45% lower fuel costs, enabling payback in 1–2.5 years. –Extended range: Its Xingzhi H9M methanol light trucks offer over 1,000km of range, helping to address long-haul transport needs. While frequent refuelling may be required due to methanol’s lower energy density compared to conventional fuels, the extended range still represents a significant improvement over purely electric alternatives, particularly for scenarios requiring long- distance operation. –Emission reduction: Methanol commercial vehicles cut particulate matter by 98%, carbon monoxide by 88% and nitrogen oxides by 82% compared with China VI diesel vehicles. The Anyang green methanol project can lead to CO2 reductions of 160,000 tonnes annually by capturing CO2 from industrial exhaust to synthesize 110,000 tonnes of methanol. Source: Geely Farizon interview and documents review. Green Logistics Innovation for Emerging Markets: Driving Competitiveness and Shared Value 17