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China Blistering Past US in Green Investment

Leon Kaye | Monday March 29th, 2010 | 2 Comments

The Pew Charitable Trusts released a study showing that for the first time, China is leading the United States in green technology investment.  Considering that China is four times the size of US, the study may not be surprising, but the pace at which Chinese investment has increased is certainly shocking.  Five years ago, the Chinese had only invested about US $2.5 billion in green and clean technologies.  But in 2009, that figure had soared to US $34.6 billion, almost twice that of the United States, which lagged at US $18.6.

The Pew study found that countries with strong and clear national policies, mandated clean energy quotas, prioritized loans for renewable energy projects and a carbon market, were leaders in the green technology revolution.  Hence Germany, Brazil, Spain, the UK, and China have the largest clean energy industries when measured as a percentage of their economies.  Countries without such a policy framework are falling behind:  Japan, Australia, and the United States fall into this group.  So when using renewable energies’ percentage of a national economy, China comes in third. And the United States?  A laggardly eleventh.

Many factors are at play here.  China has a strong national industrial policy, while the United States is really a federation of 50 different governments, each with a different agenda and often at loggerheads with Washington, DC.  China reaps about 700,000 newly graduated engineers annually, but the United States still struggles educating its students in the sciences.  Finally, as the US Congress has been bogged down in the details over climate change and cap-and-trade legislation, Chinese leaders established aggressive renewable energy targets that aim to cope with China’s growing demand for energy.

Whatever the reasons behind China’s surging renewable energy investment may be, the Pew’s researchers have weakened US leaders’ claims that it is unfair to give China and India a “pass” on emission reductions while the US is pressed to reduce its carbon footprint.  Lecturing developing countries to stop dirtying the air rings hallow when it is clear that China, for example, is a leader in technologies like solar and wind.  Visit any large solar technology conference, and Chinese vendors cram exhibit hall space.  Search through Twitter, and Tiny URLs taking you to new Chinese wind energy farms crop up.  While the occasional American touts his tankless water heater, solar water heaters are ubiquitous on house and apartment roofs in China.

While it is easy to fret over these numbers, the Pew data indicate promising trends worldwide.  Renewable energy investments increased 230 percent since 2005; 250 gigawatts of renewable energy has been generated worldwide, creating 6% of the world’s energy needs; and the G20 nations’ production of renewable energy has climbed 50% in the past 5 years.

But if you are bilingual in Chinese and English and have an engineering background, China may be the land where you can find your fortune.


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  • http://www.HowleyGreenEnergy.com/ John Howley

    The results are not surprising. China is far behind the US in any energy infrastructure, let alone clean energy. For example, the US and China spent about the same amount of money last year on “smart grid” investments. But the US already has a grid that extends to just about every person in the country and the “smart grid” investments were designed as improvements. While China — which is four times the US — still needs to build the basics. Also China is still relying on coal for a huge percentage of its new generation capacity. The bottom line is that China is investing more because it is so large and so far behind.

    That said, the US should not play hare to China's tortoise. The US can and should lead this survey.

  • http://www.HowleyGreenEnergy.com/ John Howley

    The results are not surprising. China is far behind the US in any energy infrastructure, let alone clean energy. For example, the US and China spent about the same amount of money last year on “smart grid” investments. But the US already has a grid that extends to just about every person in the country and the “smart grid” investments were designed as improvements. While China — which is four times the US — still needs to build the basics. Also China is still relying on coal for a huge percentage of its new generation capacity. The bottom line is that China is investing more because it is so large and so far behind.

    That said, the US should not play hare to China's tortoise. The US can and should lead this survey.