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Sunday, April 11, 2010
China's the Up-and-Comer for Renewable Energy Sources
By John Fleck
Of the Journal
If you want to see how green is done these days, China is where the action is.
With a voracious appetite for fuels to power its rapidly growing economy, China's energy sector is booming, and nowhere is that more evident than the Asian giant's pursuit of green energy.
But this is about more than just meeting China's internal needs, according to Sen. Jeff Bingaman, D-N.M. China sees green energy — wind, solar and the like — as the global growth industry of the 21st century. And it aims to dominate this new global market.
"The Chinese government has determined that this is an area of substantial opportunity for them," said Bingaman, chairman of the Senate Energy Committee, in an interview last week after returning from a week-long fact-finding trip to learn more about what the Chinese are up to.
If the United States does not respond, we risk losing out on a major global economic growth opportunity, Bingaman said.
In 2009, China invested $34.6 billion in clean energy technology, according to a report last month from the Pew Environment Group, making it far and away the leader among the world's industrialized nations.
That is nearly double the investment made last year in the United States, which is in second place, according to the Pew data.
In addition to investments by its government, China also has been successful in drawing private-sector foreign investment to its green energy sector, according to Phyllis Cuttino, one of the Pew report's authors.
Consider Baoding, one of Bingaman's China stops. Located southwest of Beijing, it was once a center of automobile and textile manufacturing. But a suite of government investments at the national, regional and local level is transforming it into "Electric Valley," a solar and wind energy analog to the computer tech mecca of Silicon Valley here in the United States.
Some 200 green energy firms are now located there, according to Jesse Jenkins, an energy policy analyst at the Breakthrough Institute, a California think tank. Jenkins and his colleagues published a report last fall arguing that China and other Asian economic powers are "set to dominate the clean-energy race by out-investing the United States."
China faces three problems that have meshed in its green energy strategy:
• A need for more domestic energy as its economy expands;
• A growing desire for energy sources that do not pollute (something common as nations become more affluent);
• A need for new export markets for its expanding manufacturing base.
Coal still plays a central role in China's energy future, Cuttino noted. "They haven't given up on coal," she said. But China also is now second only to the United States in total renewable energy generation, and is poised to pass us, possibly this year.
To achieve its goals, China is using its internal market to jump-start its wind and solar manufacturing base. In 2005, according to Jenkins and his colleagues, it approved a national renewable energy standard, a requirement than 10 percent of its electricity supplies come from renewable sources by 2020.
Two years later, the government upped that to 15 percent by 2020, and also set a goal of the equivalent of 40 new nuclear power plants by 2020. And, according to Jenkins and his colleagues, there are reports that the government may more than double the nuclear power goal.
That has led to the creation of companies like Suntech. Based in the Chinese city of Wuxi, it was founded less than a decade ago and already is the world's largest manufacturer of photovoltaic panels. Bingaman called his visit to Suntech and Wuxi, another city where government is providing incentives to spur growth of a green energy sector "eye-opening."
China also has established 16 energy technology research centers and is investing heavily in training engineers to help spur the development of green energy technology.
By comparison, Bingaman said the U.S. government spends "appallingly little" on energy research.
The United States and the rest of the industrialized world stands to benefit from China's efforts to develop low-cost alternative energy technologies, Bingaman said. But he said we risk losing out on a potentially lucrative sector of the 21st century global economy "if we don't have a well thought out and executed strategy of our own."
E-mail: jfleck@abqjournal.com
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