China Sitting Pretty To Dominate New Clean Energy Future, Claims IEEFA
With the United States pulling out of the Paris Climate Change Agreement, China has solidified its position as the dominant global clean energy powerhouse in 2017, and is set to lead the way in clean energy which is expected to lead the way in global power capacity additions for at least the next two decades.
These are the high-level key points from a new report published by the Institute for Energy Economics & Financial Analysis (IEEFA) this week, which concludes that even though “China is undoubtedly a major funder of coal-fired power projects around the world … indications are that renewable energy will dominate global power capacity additions for at least the next two decades. China is preparing now to lead this new energy world.”
The report, China 2017 Review: World’s Second-Biggest Economy Continues to Drive Global Trends in Energy Investment (PDF), analyzes China’s continued progress in clean energy sectors during 2017, and looks forward to the role China will likely play in the coming decades as clean energy capacity additions line up to sweep away traditional fossil fuel-powered capacity additions.
“The clean energy market is growing at a rapid pace and China is setting itself up as a global technology leader while the US government looks the other way,” said Tim Buckley, co-author of the report and IEEFA’s director of energy finance studies. “Although China isn’t necessarily intending to fill the climate leadership void left by the U.S. withdrawal from Paris, it will certainly be very comfortable providing technology leadership and financial capacity so as to dominate fast-growing sectors such as solar energy, electric vehicles and batteries.”
Looking back, 2017 proved a phenomenal success for China in terms of both its renewable energy development and its efforts to curb renewable energy curtailment. Estimates are that China installed at least 50 gigawatts (GW) of new solar capacity in 2017, and Bloomberg New Energy Finance is predicting it could be as high as 54 GW, while the International Energy Agency believes that China will continue to lead the world in renewable energy development going forward as well.
Part of the confidence in these predictions is due to the all-or-nothing attitude China is taking to its Belt and Road Initiative, which has already driven $8 billion worth of solar equipment exports into neighboring regions. Meanwhile, China’s burgeoning wind energy industry is similarly looking overseas to expand its impact and dominance, led by China Energy Investor Corporation Xinjiang Goldwind and China Three Gorges. Add to this the role China’s leading hydropower companies are taking in Latin America, Africa, and Asia, and China is quickly cementing its authority across a number of technologies. One wonders how long it will be before the nation casts its gaze towards offshore wind.
“It has become clear that renewables will be the dominant energy technology of the following decades with even the cautious International Energy Agency (IEA) accepting that renewables will receive the majority of energy investment going forward,” Buckley added. “China is not going to buck this trend; although it is still investing in some coal projects around the world, China will embrace the direction energy markets are moving in and is setting itself up as a global technology leader.”
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