China steals the march on Clean Tech

China’s position as one of the world’s pre-eminent clean tech hubs was underlined yesterday, with the release of a major new report from The Climate Group arguing that the country has already secured a lead over many of its global rivals in the race to develop and implement low-carbon technologies.

The report, which updates a similar study from last year, concluded that despite the onset of the global recession, Chinese clean tech firms are continuing to record impressive growth, aided in no small part by the government’s decision to focus much of its $585bn (£354bn) stimulus package on low-carbon projects.

The study found that while the Chinese government is resisting international calls to set carbon emission targets, it is delivering good progress against domestic targets to improve energy efficiency, having cut the energy intensity of the economy 60 per cent since 1980.

It also highlighted the leadership position China has secured in the renewable energy sector, producing about a third of the world’s photovoltaic (PV) solar panels each year and doubling wind energy capacity in 2008 to take fourth spot in the global league table.

Liu Yanhua, vice minister of China’s Ministry of Science and Technology, said the country’s clean tech sectors had delivered “remarkable progress” over the past two years. “China’s installed wind power capacity is doubling annually; China has produced nearly 40 per cent of the world’s solar PV products; China has the world’s largest raw material resource for biofuel; and China’s auto industry is working to lead the world’s new energy automotive industry,” she said.

However, the report also warned that the rapid rollout of clean technologies will be essential to China’s efforts to curb carbon emissions given the continuing rapid expansion of the country’s economy.

It calculates that based on current trends, the number of cars on the country’s roads will triple to 150 million by 2020, accounting for a fifth of global carbon emissions. Consequently, the success of initiatives such as the government’s $2.9bn electric car development programme – which has already seen 13 cities purchase 13,000 electric cars – is deemed essential to climate change efforts.

Speaking at the official launch of the report in Beijing, former UK prime minister Tony Blair said the Chinese government would not be able to implement measures to curb car ownership and as a result had to focus on delivering low-carbon vehicles.
“I think the way we consume has to change, but I think it is completely unrealistic to say to people you can’t have a car, you can’t use a motorbike,” he said. “It is just not going to happen.”

Reiterating his view that new technologies offer the best hope of cutting emissions, Blair, who is closely affiliated with The Climate Group, said that industrialised nations will be unable to convince emerging economies to sign up to new development models based on reduced consumption. “If you were to say to people in China that we in the West have grown our economies and consumed all this, but you must live in poverty for the sake of the planet, they will say ‘No, I will not’,” he said.

The report also warned that the expansion of the Chinese clean tech sector was still largely reliant on the development of new financing mechanisms capable of raising the estimated $585bn a year that is required to meet its energy efficiency and carbon emission goals.

Changhua Wu, greater China director at The Climate Group said that despite the recent growth, significant increases in investment were still required. “It’s a 70-30 situation,” he said. “We have 70 per cent of the solutions today, but they are not all proven technologies and none are at the scale we need. Thirty per cent of the solutions will be found in the future. Therefore we still need foreign investment to drive the revolution.”

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