China is taking the inside track in the cleantech sector—and jockeying for position with longtime leader Denmark— according to a new report sponsored by the Washington, D.C.-based conservation group, World Wildlife Fund (WWF), and released to the Associated Press (News - Alert) this week.
Denmark earns the biggest share of its GDP (3.1 percent or $9.4 billion) from producing windmills and other clean technologies, the United States is rapidly expanding its clean-tech sector (0.3 percent of its GDP, or $45 billion)—but no nation can match China’s pace of growth (1.4 percent of its GDP or $63 billion) based on the study, which was scheduled to be presented at the CleanTech Forum Amsterdam, May 9 through May 11.
Indeed, China's production of green technologies has increased by a remarkable 77 percent a year, according to the report, but some (including the number 17-ranked United States, which has been growing at a rate of 28 percent a year) are questioning whether this unbridled growth is being achieved at an unfair advantage.
For example, at the 14th Shanghai International Automobile Industry Exhibition last month, automakers were concerned that Beijing’s forthcoming 10-year industry development plan for “new energy vehicles” might require foreign manufacturers to hand over valuable technology and help local partners create “indigenous brands” as the price of being allowed to sell electric cars in China.
And last December, the Obama Administration filed a case against China with the Switzerland-based World Trade Organization, siding with an American labor union, the United Steelworkers, in accusing Beijing of illegally subsidizing the production of wind power equipment. The United States challenged a special Chinese government fund that awards grants to makers of wind power equipment, saying that the fund provides subsidies that are illegal under W.T.O. rules because the grants appear to be contingent on manufacturers using parts made in China.
Beijing has long pushed for technology transfer in fields from high-speed rail to clean energy as a condition of contracts or licenses. China's bullet trains are based on European and Japanese technology, but are being marketed in Latin America and the Middle East—prompting complaints it is violating the spirit of such agreements.
"The Chinese have made, on the political level, a conscious decision to capture this market and to develop this market aggressively," said Donald Pols, an economist with the WWF.
"When you speak to the Chinese, climate change is not an ideological issue. It's just a fact of life. While we debate climate change and the transition to a low carbon economy, the debate is passed in China," Pols said. "For them it's implementation. It's a growth sector, and they want to capture this sector."
Rob Gramlich, Senior Vice President for Public Policy at the American Wind Energy Association, a Washington, D.C.-based national trade association, said that the United States “can be a world leader in turbine manufacturing and exports” and that “any practice that tilts the global playing field unfairly would be of serious concern to our members who want to play a role in China, which has become the world’s largest wind market.”
Following Denmark and China, other countries in the top five clean-tech producers, in terms of percentage of GDP, are Germany, Brazil and Lithuania, the report said.
The report was prepared by Roland Berger Strategy Consultants, a global firm based in Germany. It gathered data on 38 countries from energy associations, bank and brokerage reports, investor presentations, the International Energy Agency and a score of other sources. It measured the earnings from producing renewables like biofuels, wind turbines, and thermal equipment, as well as energy efficiency technology such as low-energy lighting and insulation.
The World Wildlife Fund announcement follows another recent report, released in April by the Lawrence Berkeley National Laboratory’s China Energy Group. China’s Energy and Carbon Emissions Outlook to 2050, found that, counter to conventional wisdom, China’s steeply rising energy consumption will start to level off between 2030 and 2035.
“Once nearly every household owns a refrigerator, a washing machine, air conditioners and other appliances, and once housing area per capita has stabilized, per household electricity growth will slow,” report co-author Mark Levine explained. It will reach a certain saturation point.
And some critical industries will taper off even sooner. “China will reach saturation in road and rail construction before the 2030-2035 time frame, resulting in very large decreases in iron and steel demand. Additionally, other energy-intensive industries will see demand for their products flatten.”
Work on the project has been ongoing for the last four years. The 72-page report was summarized in a briefing to U.S. Congressional staffers. Founded in 1931, Berkeley Lab’s scientific expertise has been recognized with 12 Nobel (News - Alert) prizes. The University of California manages Berkeley Lab for the U.S. Department of Energy’s Office of Science.
Cheryl Kaften is an accomplished communicator who has written for consumer and corporate audiences. She has worked extensively for MasterCard (News - Alert) Worldwide, Philip Morris USA (Altria), and KPMG, and has consulted for Estee Lauder and the Philadelphia Inquirer Newspapers. To read more of her articles, please visit her columnist page.Edited by
Rich Steeves
