Race to the Top

By WANG HAIRONG

Race to the Top

By WANG HAIRONG

The global race in developing and deploying green energy technology can be a w in-w in game

“C lean energy race” has become a catchphrase for journalists and bloggers to attract reader eyes.Googling that, one w ill be amazed by the number of recent headlines churned out.

American politicians and businessmen reportedly used the race analogy to persuade Congress to pass climate and energy bills that encourage the development of clean energy.

A decade ago, the race was between the United States, Japan and Europe in terms of solar photovoltaic(PV) shipments and Denmark in terms of w ind turbine manufacturing. Recently, the race is often framed as being against China.

A report titled “Who is w inning the green energy race?”published by the Pew Charity Trusts found, for the first time,China took the top spot fo r overall clean energy finance and investment in 2009, pushing the United States into second place.

In terms of installed capacity,the report said “the United States led the world in installed w ind,biomass and geothermal power capacity, but was very close to losing its top position in overall installed capacity as China surged forward.”

O n th e su p p ly s id e,Denmark’s Vestas and U.S. sup

plier GE Energy, a subsidiary of General Electric, nearly tied atop the list of the world’s two w ind turbine producers, while three Chinese companies, Sinovel, Goldwind and Dongfang, entered the global top 10 in 2009, said a report by BTM Consult ApS, a famous Denmark-based consulting fi rm.

As for solar PV producers, American company First Solar led solar PV module shipment in 2009, followed by Chinese company Suntech Power Holding Co. Ltd. and Japanese company Sharp Electronic Corp.,according to IMS Research.

Government policy incentives make the difference, the Pew report points out, those nations with strong national policies aimed at reducing global warm ing and incentivizing the use of renewable energy are establishing strong competitive positions in the clean energy economy.

The Pew report show s confidence in America’s potential to “recoup leadership and a market share” in the future, given the country’s entrepreneurial traditions, strengths in innovation and its leadership in venture capital investing.

Behind the smoke and mirrors

JOINT PROJECT: Construc tion o f the first phase o f the Sanm en Nuc lear Pow er Plant started on Decem ber 15, 2009 in Zhe jiang Province. This is the largest jo in t pow er gene ration p ro jec t be tw een China and the United States so far

In clean energy sectors, policymakers seem to face a dilemma. They pledge to address climate change and accelerate renewable energy technologies, but they are also tempted to nurture and protect domestic clean technology markets to create green jobs at home and ensure domestic political support, said a World Resources Institute (WRI) working paper dated May 2010.

Some TV political campaign advertisements during the U.S. m idterm election suggested that money for renewable energy projects had been sending “jobs to China,”the American W ind Energy Association(AWEA) found.

To debunk false political advertisements,AWEA released a statement on October 14. It cited data from the U.S. International Trade Commission, which said China currently represents less than 5 percent of the imported value of turbine components for the U.S. market.

So far, only three of 33,000 (0.009 percent) w ind turbines installed across the United States were sourced from China,stated the AWEA.

The market share of Chinese turbine manufacturers on a worldw ide basis grew significantly in 2009, yet “to date, that grow th has been based almost entirely on sales to the Chinese market,” according to the U.S. Department of Energy in its 2009 W ind Technologies Market Report.

None zero-sum gam e

Fram ing the global clean energy industry in competitive terms is not adequate in some senses. The race metaphor, some experts say, fails to take into account the clean energy industry’s increasing global integration.

The WRI report found the solar PV value chain has experienced fast globalization over the past years, through cross-border investment flows,and especially through high levels of cross-border trade in raw materials and intermediate and finished products.

Local job creation is at the

heart of calls for a more protectionist configuration of national trade and investment regimes,the WRI report noted.“Because of the way supply chains are interconnected, you can’t w in the clean energy race by banning technologies from other countries or by banning investment because it hurts U.S.companies,” Barbara Finamore,China Program Director at the Natural Resources Defense Council told The Washington Independent, a non-partisan online news network.

“I actually think healthy,

peaceful international competition in this sector is one of the best ways to promote the development of these technologies and their deployment around the world,” Teryn Norris toldMiller McCunemagazine.

Norris is an energy policy analyst and former project director at the Breakthrough Institute, a California-based think tank striving to let us “enjoy secure, free, prosperous,and fulfi lling lives on an ecologically vibrant planet.”

Another problem w ith the race image is that it suggests only one country can w in,Lutz Weischer, a research analyst at the WRI, told The Washington Independent.

W ith renewables, any player turns out as a w inner. “You w in if you decide to play,”Weischer said.