Sunday, June 23, 2024

What China’s renewable energy boom means for the world

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China made historic increases in installations of solar, wind, and other renewable energy in 2023, including adding 216 gigawatts of solar capacity. Experts say China’s rapid adoption of renewable energy is helping move the country – the world’s biggest emitter of heat-trapping gases – toward its climate goals faster than expected. 

For example, China has committed to reaching its carbon peak by 2030, but some analysts say its emissions could peak as early as this year, and then start declining. This hinges partly on China’s ability to stabilize its surging energy demand, a significant portion of which is still being met by coal. China’s state-led market dominance in renewables is also provoking trade retaliation, with the United States raising tariffs this week on Chinese solar panels, electric vehicles, and other goods.

Why We Wrote This

China’s booming renewable energy industry may be stirring trade tensions, but it could also accelerate a green transition – in China and elsewhere.

Experts say Beijing’s investments in renewable energy benefit many countries that lack such industries, and note that trade barriers imposed by developed countries will create inefficiencies and increase costs, at least in the short term.

“In the long term, [the tariffs] could be somewhat positive because you get more distributed production, which might be more stable,” says Jan Ivar Korsbakken, a researcher in Oslo, Norway. “The issue, of course, is that we don’t have a lot of time.”

At a sprawling facility in eastern China, engineers and quality control workers in blue and pink uniforms monitor the heavily robotic assembly line for Sungrow Power Supply Co. Ltd.

The firm is one of the world’s biggest producers of solar inverters – equipment critical to making electricity from solar panels usable in grids. And its products are now sold in 170 countries, part of the explosion of China’s renewable energy industry that is fueling trade tension but also facilitating the shift to green power, here and overseas.

Flanked by ceiling-high video screens showcasing Sungrow’s clean energy capabilities, Senior Vice President David Zhao boasts that the company’s total installed capacity has exceeded 500 gigawatts globally. “This is a very great contribution” to the green energy transition, he says at the company’s headquarters in Hefei, China.

Why We Wrote This

China’s booming renewable energy industry may be stirring trade tensions, but it could also accelerate a green transition – in China and elsewhere.

Experts say China’s rapid adoption of renewable energy is helping move the country toward its climate goals faster than expected. Last year, China made historic increases in installations of solar, wind, and other renewable energy, including adding 216 gigawatts of solar capacity – more than what exists in the United States.

China – the world’s biggest emitter of heat-trapping gases, accounting for 35% of carbon emissions in 2023 – has committed to reaching its carbon peak by 2030 and carbon neutrality by 2060. But some analysts say its emissions could peak as early as this year, and then start declining. This also hinges partly on China’s ability to stabilize the country’s surging energy demand, a significant portion of which is still being met by coal.

“If the energy demand growth rates normalize and the green energy additions continue, then the first half of this year – so essentially right now – would be the peak,” says Lauri Myllyvirta, senior fellow at the China Climate Hub of the Asia Society Policy Institute. “There is no way to reach the global goals without a much faster peak in emissions in China,” he says. “It’s basically our only hope.”

Costfoto/NurPhoto/AP/File

Workers produce solar photovoltaic modules for export on the production line of a new energy workshop in Hai’an, China, June 6, 2023.

An energy “tug of war”

While the expansion of renewables is promising, China’s overall climate trajectory remains uncertain. The country remains highly dependent on coal and continues to open new coal-fired plants.

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