#35 — THE US-CHINA GREEN ENERGY BATTLE
Until recently, US Climate Envoy John Kerry must have felt like Prometheus, awakening each day to have his liver torn out by Zeus’s avenging eagle for trying to enlighten mankind. Kerry’s torture was to jet around the globe attempting to convince other countries to step up to bat in the climate fight while the US stood with its hands in its pockets.
China in particular must have had some good laughs at Mr. Kerry’s expense. Yes, China has recently surpassed the US as the worlds biggest greenhouse gas emitter, but please remember that it has more than 4 times as many people. And yes, China is still building coal fired power plants, but you can’t expect them to build all our iGadgets, and the myriad other stuff that our consumer society demands by rubbing two sticks together. To match China’s per capita greenhouse gas production, the average American would need to cut their energy consumption by over 70%. Hard to see that happening.
While we’re in show & tell mode, consider that China:
has half of all the electric cars in the world,
has 99% of the electric buses in the world,
has about 2.4 times as much wind power as the US,
has 3.2 times as much solar power as the US,
manufactures 70% of the world’s solar panels,
produces almost 80% of the world’s lithium batteries,
is home to 8 of the top 14 wind turbine builders,
and so on….
So, while China leads the world in greenhouse gas emissions, it also leads in producing renewable energy. And it is miles ahead in producing the equipment that the rest of the world needs to address climate change. While the US was busy with its culture wars, China was buying up lithium reserves, perfecting its chip technology, building electric buses and cranking out solar panels.
Of course, China is developing these products with the intention of selling them to us, so why not just keep buying them? While the US has continued to be a leader in innovation, its companies have been happy to ship our manufacturing offshore, along with its inconvenient pollution and labor problems. American workers have been largely drugged into acquiescence with the resulting cheap goods from Amazon, Walmart and Dollar Stores.
But our huge dependence on China for green technologies, along with the chilling of our bilateral relationship, is a worrying prospect. We can see the danger of our current approach in the stark contrast of how Tesla, with its largely in-house supply chain, has shot ahead while the rest of the auto industry taps its feet waiting for computer chips from the East. Or consider the consequences of Europe’s heavy dependence on Russian natural gas.
And now for something completely different…
With the passage of the Inflation Reduction Act, perhaps Mr. Kerry will be able to walk into his upcoming meetings with a little more bounce in his step. This bill alone will allow the US to come within spitting distance of its current climate pledges. And, together with the recently passed CHIPS act, it does much more: it essentially throws down the gauntlet to China, saying that we intend to compete with them in the manufacturing of solar, wind and battery technologies. POLITICO
There are some unfortunate protectionist policies in the new IRA bill, like those restricting EV subsidies to cars with US content. Such are the political costs of getting such a massive bill through with no bipartisan support. But some real competition in green technologies from the US would be a climate activist’s dream come true. It could stabilize prices, increase supply, speed deployment and provide a lot of good jobs. Let’s all keep our fingers crossed!
Things you can do
Get in touch with your congressperson and thank them for their wonderful accomplishments this session. Even if they opposed them all, they’ll take the hint — and probably the credit!
Check out this interesting calculator to see what energy saving appliances the IRA might help you buy. REWIRING AMERICA
Thanks for reading,
Doug Hylan Brooklin, Maine
“Oil companies complain that even if they wanted to invest more, it would be hard because Wall Street isn’t keen on financing new fossil fuel projects. Some investors are instead putting their money into renewable energy, electric cars and other businesses. It is not that investors have become environmentalists. Many have run the numbers and concluded that the recent jump in fossil fuel prices will be short-lived and that they are better off investing in companies and industries that they believe have a brighter future.” Clifford Krauss