20.09.2023 Article

How China Has Become a Global Leader in Green and Clean Energy

By Aishwarya Sanjukta Roy Proma
How China Has Become a Global Leader in Green and Clean Energy
20.09.2023 LISTEN

China is becoming a global leader in clean and green energy by investing heavily in renewable energy sources, such as wind and solar power, and setting ambitious goals to reduce its carbon emissions. China is the world's largest producer and consumer of energy and also the biggest emitter of greenhouse gases. Therefore, China has a great responsibility and opportunity to combat the climate crisis and contribute to global efforts to limit global warming to 1.5°C above pre-industrial levels.

With that goal, China's green energy sector is undergoing rapid and remarkable development to combat the climate crisis. China is on track to double its wind and solar energy capacity and hit its 2030 clean energy targets five years early. China's utility-scale solar capacity has reached 228 gigawatts, more than that of the rest of the world combined. China's combined onshore and offshore wind capacity now surpasses 310 GW, double its 2017 level and roughly equivalent to the next seven top countries combined. China is also the world leader in hydropower, with over 370 GW of installed capacity. China has recognized the environmental and economic benefits of shifting from fossil fuels to renewable energy sources, such as improving air quality and enhancing energy security. So, China has implemented a series of policies and incentives to support the development and deployment of renewable energy, such as feed-in tariffs, subsidies, quotas, tax breaks, green certificates, carbon trading, and green finance. China has invested $546 Billion in Clean Energy in 2022.

China has maintained its position as the world's largest producer and consumer of renewable energy, accounting for about 30% of global renewable energy consumption in 2020. China's renewable energy consumption reached 2.2 billion tons of coal equivalent in 2020, up by 9.5% year-on-year. Further, China is set to double its capacity and produce 1,200 gigawatts of energy through wind and solar power by 2025. In addition, China added about 3 gigawatts of new energy storage capacity in 2022, more than any other country in the world. China also has a strong pipeline of new projects under construction or planned, such as Tesla's mega-battery project in Shanghai.

China's green energy transition is a strategic and ambitious goal to have 80% of its public vehicles be new energy vehicles by 2030. China has maintained its position as the world’s largest producer and consumer of electric vehicles, accounting for about 40% of global EV sales in 2020. China’s EV market grew by 8% year-on-year, despite the impact of the COVID-19 pandemic. China has become a global leader in renewable energy technology and innovation. China is the largest manufacturer and exporter of solar panels, wind turbines, batteries, and electric vehicles in the world. China is also investing in emerging technologies, such as hydrogen, carbon capture and storage, smart grids, and artificial intelligence, to enhance its green energy competitiveness and efficiency.

Following that, China has rapidly shut down the older and more inefficient coal plants, especially those that perform poorly in terms of environmental criteria. These plants account for 18% of existing coal capacity and are mostly located in Shandong, Inner Mongolia, Henan, Hebei, Jiangsu, and Shanxi. In addition, China has pledged to control coal consumption. This would help China reach carbon neutrality by 2060.

China is the world's largest producer and exporter of solar panels, wind turbines, batteries, and electric vehicles, which are essential for the transition to renewable energy sources. Currently, China accounts for 80% of global solar photovoltaic (PV) module production and 77% of global lithium-ion battery production in 2020. China also dominates the global market for rare earth elements, which are used in many green technologies, such as magnets for wind turbines and electric motors. China is also a leader in hydrogen (H2) production and consumption, which plays a key role in the decarbonization plans of the European Union and the US. China produces about 22 million tons of H2 per year, mostly from coal and natural gas, and consumes about 20 million tons, mainly for industrial purposes. China is a major partner and competitor of the European Union and the US in the global clean energy market and cooperation. China is involved in many bilateral and multilateral initiatives and agreements on green energy, such as the Mission Innovation, the Clean Energy Ministerial, the Paris Agreement, and the Global Methane Pledge. Therefore, the West is dependent on China for green technologies in various dimensions, which may create opportunities and risks for its energy transition and security.

However, China needs to peak its carbon emissions by 2030 and reduce them by more than 90% by 2060, which means a drastic and rapid transformation of its energy system from fossil fuels to renewable sources. China still relies heavily on coal for its electricity generation, which accounts for more than half of its total energy consumption and carbon emissions. Coal is also a cheap and stable source of energy that supports China's economic growth and social stability. Further, China plans to achieve a 2°C-compatible coal power phase-out by 2050–2055 and a more ambitious 1.5°C phase-out by 2040–2045. China's green energy transition is not only a domestic issue but also a global one. China's carbon emissions have significant impacts on the global climate system and international efforts to limit global warming. So, China has established a green finance system to support the development and deployment of green technologies, such as green bonds, green loans, green funds, green insurance, and green ratings. China also needs to rethink energy projects with developing countries, which have different priorities and capacities for the transition.

There are some of the major challenges that China faces in its green energy transition. However, these challenges also create opportunities and incentives for China to innovate, collaborate, and lead in the global clean energy revolution. China's green energy transition depends largely on the availability and accessibility of the minerals and materials that are essential for the production of renewable energy technologies, such as lithium, cobalt, copper, nickel, etc. These minerals are mostly concentrated in a few countries, such as Australia, Chile, Congo, Indonesia, etc., which may pose risks of geopolitical conflicts, trade disputes, or supply disruptions. Also, China's green technology manufacturing relies heavily on the extraction and processing of minerals and materials that are often scarce, toxic, and polluting. For example, China produces solar photovoltaic but also consumes about 70% of the world's polysilicon, a key material for solar cells that requires large amounts of energy and water to produce. China also faces the problem of disposing of or recycling waste and obsolete products from its green technology industry, such as used batteries, solar panels, and wind turbines.

Moreover, China's dominance in green technology is not unchallenged by other countries, especially the US and the EU, which have been increasing their investments and policies to support clean energy industries and innovation. The US passed a series of bills in 2022 to boost its research and development, manufacturing, and deployment of renewable energy technologies, such as solar, wind, batteries, hydrogen, and carbon capture. The EU also launched a series of initiatives and regulations to promote its green transition, such as the European Green Deal, the Next Generation EU Recovery Fund, the Carbon Border Adjustment Mechanism, and the Renewable Energy Directive. These efforts may erode China's market share and technological edge in some areas of green technology, such as batteries and hydrogen.

In conclusion, China is becoming a global leader in clean and green energy by pursuing a strategic vision and taking concrete actions to transform its energy system from fossil fuels to renewable sources. China's green energy transition is beneficial not only for its environment but also for global climate action and cooperation. So, China needs to balance its interests and obligations with those of the international community in pursuing its green technology development and governance.

Author’s Bio
Aishwarya Sanjukta Roy Proma is a Research Associate at the BRAC Institute of Governance and Development (BIGD). She is a research analyst in security studies. She obtained her Master's and Bachelor's in International Relations from the University of Dhaka, Bangladesh. She can be reached at [email protected].