China Takes the Lead on Clean Energy Jobs: How the U.S. Can Still Win

This post is by Tony Kreindler, media director for the National Climate Campaign at Environmental Defense Fund.

A majority of Americans are worried that the United States’ role in the world economy will diminish in the coming years, according to a new Washington Post-ABC News poll.

But the truth is, China is already beating the U.S. to clean energy jobs.

China is quickly becoming the global powerhouse in clean energy manufacturing and innovation, dwarfing the efforts of America. Backed by huge investment and an industrial policy bigger than the world has ever seen, China has become the worldwide leader in new energy technology markets while the U.S. is quickly falling behind.

But we can match the scale of China’s centralized industrial policy by fully deploying the engine of American prosperity: our marketplace. It is the only tool we have with the scale and capital to compete with China.

If the U.S. puts a limit on carbon pollution from dirtier sources of energy, we will send a clear signal to the marketplace that will unleash a massive wave of private investment in clean energy that would allow us to compete with the Chinese.  Only when American policy creates a profit motive for investors, inventors and entrepreneurs, will we have a chance to win the race.

President Obama made that case to the Business Roundtable. He called for a price on carbon to kick-start America’s efforts to win the clean technology race.

Key excerpts of the President remarks:

A competitive America is also an America that finally has a smart energy policy.  We know there is no silver bullet here – that to reduce our dependence on oil and the damage caused by climate change, we need more production, more efficiency, and more incentives for clean energy.

But to truly transition to a clean energy economy, I’ve also said that we need to put a price on carbon pollution …

What we can’t do is stand still.  The only certainty of the status quo is that the price and supply of oil will become increasingly volatile; that the use of fossil fuels will wreak havoc on weather patterns and air quality.  But if we decide now that we’re putting a price on this pollution in a few years, it will give businesses the certainty of knowing they have time to plan and transition.  This country has to move towards a clean energy economy.  That’s where the world is going.  And that’s how America will remain competitive and strong in the 21st century.

If Congress puts a limit on carbon pollution, the U.S. will compete with China. If we don’t, there’s no reason to believe the future will look any different than the facts we see today. Those facts are listed below, or you can download and print EDF's one-page handout version [PDF].

China’s Climate and Energy Policies Create an Investment Advantage

  • In 2009, China dedicated $440 billion in government funding solely to clean energy. –AFP, 5/24/2009
  • Renewable energy industries in China reached 1.12 million jobs in 2008 and are increasing by 100,000 a year. –NYT, 1/31/2010
  • China is already moving aggressively on measures it promised at Copenhagen, including closing an additional 10 gigawatts of inefficient, polluting coal plants. – Washington Post, 1/7/2010
  • In December 2009, China passed a law requiring its electric grid companies to buy any and all electricity generated from renewable sources. – WSJ, 12/27/2009

China Goes into Wind Power Overdrive in 2009

  • Five years ago, there was almost no Chinese presence in the wind manufacturing industry, and now China hosts the world’s largest wind market with installed capacity of over 25,000 MW, a significant increase from 2008, when China was home to about 12,000 MW. –  GWEC, 2/3/2010
  • As the world’s wind power capacity grew by 31% in 2009, China was responsible for one-third of the additions, experiencing industry growth of over 100%. – GWEC, 2/3/2010

The Saudi Arabia of Solar

  • China has leapfrogged the West in the last two years to emerge as the world’s largest manufacturer of solar panels. – NYT, 1/31/2010
  • Already home to one-third of global solar manufacturing capacity, Chinese competition has reduced global solar prices by 30% and is forcing rivals to shift production facilities to China: U.S. Evergreen Solar Inc. is moving its assembly line from Massachusetts to China, while BP PLC's solar unit said it would stop output in Maryland and rely on Chinese suppliers instead. – WSJ,  12/15/2009
  • Responding to domestic demand, Applied Materials – the world’s largest supplier of equipment to the solar photovoltaic industry – opened the world’s largest private sector solar research center in Xian, China in October 2009. – TIME, 11/30/2009

Green Technology Investment

  • Batteries and Electric Cars – China is also leading in advanced vehicle and battery technology. Chinese firm BYD introduced the world’s first plug-in hybrid vehicle , China’s production of lithium ion batteries had accounted for 41 percent of the global market by 2008, and the number of battery companies in China increased from 455 to 613 between 2001 and 2004. – Breakthrough Institute, 11/09
  • Transmission — China is an emerging world leader in ultra-high-voltage, or UHV transmission technology, with more than 100 domestic manufacturers and suppliers.  The State Grid Corporation will invest $44 billion through 2012, and $88 billion through 2020 in building UHV transmission lines. – Center for American Progress, 6/4/2009

This content originally ran on EDF's Climate 411 blog on February 26th, 2010.

One comment

  • Thanks for the topical post; Evan Osnos wrote an excellent report in the New Yorker on China's new energy economy ambitions and achievements, and about what that means the U.S. economy. One thing the article starkly reveals is that in addition to capping carbon pollution, the U.S. needs to get serious again about investing in our energy future:

    "R. & D. expenditures have grown faster in China than in any other big country—climbing about twenty per cent each year for two decades, to seventy billion dollars last year. Investment in energy research under the 863 Program has grown far faster: between 1991 and 2005, the most recent year on record, the amount increased nearly fifty-fold.

    In America, things have gone differently. In April of 1977, President Jimmy Carter warned that the hunt for new energy sources, triggered by the second Arab oil embargo, would be the “moral equivalent of war.” He nearly quadrupled public investment in energy research, and by the mid-nineteen-eighties the U.S. was the unchallenged leader in clean technology, manufacturing more than fifty per cent of the world’s solar cells and installing ninety per cent of the wind power.

    Ronald Reagan, however, campaigned on a pledge to abolish the Department of Energy, and, once in office, he reduced investment in research, beginning a slide that would continue for a quarter century. “We were working on a whole slate of very innovative and interesting technologies,” Friedmann, of the Lawrence Livermore lab, said. “And, basically, when the price of oil dropped in 1986, we rolled up the carpet and said, ‘This isn’t interesting anymore.’ ” By 2006, according to the American Association for the Advancement of Science, the U.S. government was investing $1.4 billion a year—less than one-sixth the level at its peak, in 1979, with adjustments for inflation."

    The article ("Green Giant"): http://www.newyorker.com/reporting/2009/12/21/091221fa_fact_osnos

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