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Shared Challenges and Goals in Clean Energy

Jun 29, 2011

In President Obama’s 2011 State of the Union address, he called this “our generation’s Sputnik moment,” a reference to the era when the U.S. space program progressed in technological leaps and bounds because we were feverishly trying to stay ahead of the U.S.S.R., or, in Ronald Reagan’s words, the “Evil Empire.”

In interpreting Obama’s call for a new Sputnik era in “clean energy” and “innovation,” many pundits implicitly assumed the new competitor, or would-be Evil Empire, was China, which as the president noted has recently become “home to the world’s largest private solar research facility, and the world’s fastest computer.” Over the past year, the media has increasingly seized upon the narrative of a clean-tech “race” between the U.S. and China.

But perhaps less noticed,  when Obama has spoken to Chinese President Hu Jintao on the issue he speaks not of competition, but notes the signing of a new round of cooperative clean-energy projects between major American and Chinese firms. Some of these projects, such as a green-cities  collaboration between Duke Energy and China-based utility ENN Group, represent only the latest in an ongoing series of shared efforts. It’s too early to judge the results, but not too early to start paying close attention.

The narrative of competition makes better headlines. And no doubt, the need to create jobs and bolster manufacturing in America are both very real. But let’s also examine the overlooked half of the U.S.-China clean-tech equation – identifying areas where we can, and must, work together.

It’s no secret that China’s energy demands are growing rapidly. While China used only half as much energy as the U.S. in 2000, it had surpassed the U.S. to become the world’s largest energy user by 2009. Think about that for a moment: China’s energy use doubled in less than a decade. Over the next twenty years, as an estimated 350 million people – more than the entire population of the United States – move from rural areas to booming cities, China’s energy demands will continue to rise steeply.

When you’re growing that quickly, you need all the help you can get – and so, China is building new coal-fired plants, hydropower stations, wind farms, and nuclear plants all at an unprecedented rate. It’s investing in energy sources around the world. It’s experimenting with new energy-efficiency and transportation schemes. It’s of necessity reinventing its own energy infrastructure. That makes right now a crucial window to get things right, or horribly wrong, for China and the planet.

One thing is certain: China today is not same as the China of a generation ago, or even five years ago. The rapid change in China is a black box to many people. From a distance, one can read about it and intellectualize it, but until you visit in person you can’t really understand what is happening in China. And even if you live in Beijing or Shanghai, it’s hard to grasp all the changes underway – because so much is happening at once, and not always moving in the same direction. But experimentation is everywhere.

For example, you may have heard that about 80 percent of China’s energy mix comes from coal. But you might not have also heard that between 2006 and 2009, China shut down the equivalent of 7 percent of all power generating capacity in inefficient coal-fired power plants. Or that China has already blown by its own targets for installing wind energy and will soon have more installed capacity than all of North America. Indeed, China is expected to spend $735 billion in developing renewal energy over the next decade and aims to have 15 percent of its energy mix come from renewable sources by 2020.
Americans can react to China’s budding transformation in two ways: We can be scared that it might beat us to the future. Or we can try to see opportunities to learn, or even profit, from the rapid experimentation underway in China.

After all, it’s not only China that’s going to soon need a lot more new power plants.

Last October, Jim Rogers, the CEO of Duke Energy, now America’s largest power company, spoke in Washington at the Woodrow Wilson Center’s China Environment Forum. He made this prediction: Due to a combination of (expected) carbon controls and normal wear-and-tear, he expects that 100 percent of the power plants operating in the United States today will be shut down by 2050. In other words, America, too, will be building a whole new power infrastructure over the next 40 years.

Rogers went on to make the case for the U.S. and China cooperating – in particular, the private sectors in both countries cooperating — in power sector solutions, as his company and ENN Group are already doing. One thing American companies can gain from partnering with Chinese companies: know-how about scaling-up and bringing down costs for deploying new technology.

Consider the other shared challenges: Both the U.S. and China are reliant today on coal (the U.S. derives 50 percent of its energy from coal, whereas China derives 80 percent). Together the U.S and China account for 42 percent of total energy consumed in the world, and are responsible for about 40 percent of global carbon emissions. China is building new power infrastructure, and America will have to replace or retrofit the majority of its existing power infrastructure. Since we face similar challenges, and operate at similar scales, couldn’t we learn something from each other in the process?

This moment is “one of the most uncertain times in the history of our industry, and I’ve been a CEO for 22 years,” Rogers said. But instead of seeing China chiefly as a competitor, polluter, or new Evil Empire, he’s viewing it as a clean-tech laboratory. It’s a notion worth copying.

Peggy Liu is the chairperson and co-founder of JUCCCE. Christina Larson is contributing editor to Foreign Policy magazine.

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