The US-China trade dispute and efforts to freeze out the technology group Huawei in the US, Australia and, to a lesser degree, Britain demonstrate the fears aroused by China’s emergence as a highly competitive industrial power. To critics, the shift eastward of the global economy represents a threat to jobs and existing business models and potentially national security. But in one area, however, developments in China have produced significant gains for the world as a whole. Without its development of wind and solar power over the past decade, the growth in production from renewables would not have taken place and the transition to a low-carbon economy would hardly have begun. The fact that solar and wind power are now competitive, without any need for subsidies, with other forms of energy is largely the result of the mass production of turbines and panels by Chinese companies. The costs of wind power have fallen by 69 per cent over the past decade, while solar costs are down by 88 per cent, according to investment bank Lazard. China is now the world leader in both technologies. As a result, China is leading the energy transition. And there is much more to come. It is well ahead of anyone else in the development and application of advanced grid technology and is the world’s largest producer of lithium ion batteries with some 60 per cent of global capacity. Chinese companies installed more civil nuclear power than anyone else last year. Of the 3m electric vehicles on the world’s roads the majority are in China – it accounted for 56 per cent of sales last year. None of this is the product of pure altruism. Under President Xi Jinping, China is using its skills, financial strength and political reach to become a global industrial power. The country’s wind and solar businesses began life as ventures created to take advantage of the lavish subsidies for renewables offered in Europe.
FT 1st July 2019 read more »