China tests wind on clean energy and makes its move

Sydney Morning Herald
Saturday 11/7/2009 Page: 9

Over the past decade, whenever I went to China and engaged the Chinese on their pollution and energy problems, inevitably some young Chinese would say: "Hey, you Americans got to grow dirty for 150 years, using cheap coal and oil. Now it is our turn." It's a hard argument to refute.

Eventually, I decided that the only way to respond was with some variation of the following: "You're right. It's your turn. Grow as dirty as you want. Take your time. Because I think America just needs five years to invent all the clean power technologies you Chinese are going to need as you choke to death on pollution.

Then we're going to come over here and sell them all to you, and we are going to clean your clock [van consuming lifestyles - the demands for energy and natural resources are going to go through the roof. Therefore, ET - energy technologies that produce clean power and energy efficiency - is going to be the next great global industry, and China needs to be on board. Well, China has got on board - big time. Now I am worried that China will, dare I say, "clean our clock" in ET.

Yes, you might think that China is only interested in polluting its way to prosperity. That was once true, but it isn't any more. China is increasingly finding that it has to go green out of necessity because in too many places, its people can't breathe, fish, swim, drive or even see because of pollution and climate change. Well, there is one thing we know about necessity: it is the mother of invention.

And that is what China is doing, innovating more and more energy efficiency and clean power systems. And when China starts to do that in a big way squish you! - how do you say 'clean your clock' in Chinese? - in the next great global industry: clean power technologies. So if you all want to give us a five year lead, that would be great. I'd prefer
10. So take your time. Grow as dirty as you want."

Whenever you frame it that wav, Chinese are quizzical at first, and then they totally get it: wow, this energy thing isn't just about global warming! In a world that is adding 1 billion people every 15 years or so - more and more of whom will be able to live high-energy- - when it starts to develop solar, wind, batteries, nuclear and energy efficiency technologies on its low-cost platform - watch out. You won't just be buying your toys from China. You'll be buying your energy future from China.

"China is moving," says Hal Harvey, the chief executive of ClimateWorks, which shares clean energy ideas around the world. They want to be leaders in green technology. China has already adopted the most aggressive energy efficiency program in the world. It is committed to reducing the energy intensity of its economy - energy used per dollar of goods produced - by 20% in five years.

They are doing this by implementing fuel efficiency standards for cars that far exceed our own and by going after their top thousand industries with very aggressive efficiency targets. And they have the most aggressive renewable energy deployment in the world, for wind, solar and nuclear, and are already beating their targets."

Here's the key point on energy from the draft report of the US president's Economic Recovery Advisory Board: "If the US fails to adopt an economy-wide carbon abatement program, we will continue to cede leadership in new energy technology. The US is now home to only two of the 10 largest solar photovoltaic producers in the world, two of the top 10 wind turbine producers and one of the top 10 advanced battery manufacturers. That is, only one-sixth of the world's top renewable energy manufacturers are based in the US.

"Sustainable technologies in solar, wind, electric vehicles, nuclear and other innovations will drive the future global economy. We can either invest in policies to build US leadership in these new industries and jobs today, or we can continue with business as usual and buy windmills from Europe, batteries from Japan and solar panels from Asia." Indeed, if you look at those top 10 lists, compiled by the investment bank Lazard, Japanese companies have the most, then Europe, then China - then the US.

This is a major reason I favour the climate-energy bill passed by the US House of Representatives. If we do not impose on ourselves the necessity to drive innovation in clean technology - by imposing the right prices on carbon emissions and the right regulations to promote energy efficiency - we will be laggards in the next great global industry.

And this is why I disagree with President Barack Obama when he signals that he has to focus on extending health care and put the energy-climate bill - now in the Senate - on the backburner. Health care and the energy-climate bill go together. We need both now. Imagine how poor we would be today if US firms did not dominate the top 10 internet companies. Well, if we don't dominate the top 10 ET rankings, there is no way we are going to be able to afford decent health care for every American.