China's Energy Weapon Comes in One Color: Green
The phrase "energy weapon" tends to conjure up grainy images of Americans sporting bad hair and disco fashions waiting in line for gasoline. Might the 21st-century version involve solar panels and electric cars instead?
Amy Myers Jaffe, a director at the Council on Foreign Relations, argues along these lines in a recent essay for Foreign Affairs. China, having little to show for a $160 billion splurge of acquisitions, loans and investments aimed partly at securing foreign supplies of fossil fuels, is pivoting instead toward a greener form of energy geopolitics.
A Chinese worker from Wuhan Guangsheng Photovoltaic Company works on a
solar panel project on the roof of a 47 story building in a new development
on May 15, 2017 in Wuhan, China.
Kevin Frayer
By investing in technologies such as solar power, batteries and electric vehicles, China is building both a shield against extortion by fossil-fuel exporters and a means of reducing other countries' dependence on fossil fuels in general. Both could help blunt the influence of its great rival and aspiring energy dominatrix, the U.S.
Jaffe's aim is to warn the U.S. not to cede leadership in the new energy economy to its biggest potential adversary. And there is something weird in 2018 about the U.S. touting its raw resources while downplaying its tech edge (although tech plays a large and growing role in the shale boom).
Whether or not you think China can credibly mount a green counter-strategy, the important thing is that it will almost certainly try.
China attempting to seize leadership in developing alternative energy is, to use a technical term, a no-brainer. And on several fronts:
Pollution : The price of rapid industrialization has been the fouling of China's environment (just as it was for the West last century). Only 2 percent of China's population breathes air that meets the World Health Organization's air-quality guideline on particulates, according to the International Energy Agency.
Independence : While China is estimated to have substantial shale oil and (especially) gas resources, don't expect an Asian version of the Permian basin to spring up anytime soon. Chinese dependence on foreign fossil fuels is already higher than it ever was for Americans -- and going higher. Depending on the U.S. Navy to keep vital sea lanes open to deliver these cargoes is perhaps unwise.
Capabilities : On the other hand, China does know a thing or two about manufacturing and giving its domestic industries a nudge or two with favorable financing and political backing.
This offense launched from the factory floor is actually analogous to the U.S. one centered on shale fields and export terminals in one key aspect.
The shale boom wasn't a Washington-led attempt to reshape energy geopolitics. Rather, it was a product of raw competition in the U.S. exploration and production sector, fueled by high oil and gas prices and an army of investors willing to fund it. Either way, it has reset the cost curve for oil and gas lower, causing considerable discomfort for the likes of Saudi Arabia and Russia.
Even as that was going on, China was doing much the same to the solar-power market. As Varun Sivaram details in "Taming the Sun," his new book on the future of solar power, Chinese companies began capitalizing on existing expertise and technology in places like Australia and Canada in the early 2000s to build a domestic industry. Then a combination of Chinese government subsidies, including some for solar deployment in foreign export markets such as Germany and Spain, turbocharged it:
Similar to shale's impact, China's rapid expansion of its solar-power supply chain also crammed down the cost curve. The price per watt has dropped by 80 percent since 2010, causing many manufacturers to go bankrupt and leading President Donald Trump to target solar modules for tariffs (in vain, probably). On the other hand, it also spurred the rapid growth in solar-power deployment across much of the world.
That could be a taste of what's to come.
China's pivot from simply sucking in fossil fuels for industrialization toward rising investment in exportable new energy technologies represents a seismic shift in the global energy market (see this). This is partly because China gets more leverage in its negotiations with all energy suppliers as it expands its options (something that's happened already in oil and gas).
What makes this profound, though, is that China's investing in energies that aren't just different in terms of degree but different in kind. As I wrote here, the expansion of manufactured energies and electrification portends more fuel-on-fuel competition and deflation in the cost of raw energy. And China is a highly motivated investor in that expansion.
Will China-sized investment in new energies predicated partly on externalities such as security and pollution, and replete with subsidies, likely result in some bad bets and burned cash? Almost certainly. Will it also cut the cost of these technologies and accelerate their spread? Quite possibly.
The oft-forgotten lesson of the unsheathing of the oil weapon in the 1970s is that the resulting backlash -- in the form of efficiency, diversification and the creation of futures markets -- ushered in two decades of low prices.
Liam Denning is a Bloomberg Gadfly columnist covering energy, mining and commodities. He previously was the editor of the Wall Street Journal's "Heard on the Street" column. Before that, he wrote for the Financial Times' Lex column. He has also worked as an investment banker and consultant.
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by Liam Denning
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Some Americans - the Marlboro men, the idiots who drive bone-shaking pickups with polished chrome wheels and pristine load-beds because "manly"... - are disdainful of solar energy. A manly man must burn petroleum!
China is so-o-o-o gonna eat our lunch...
I’m looking forward to that new Ford GT500 it is rumored to have over seven hundred horsepower. The performance of the electrics is impressive but half the fun is reving a motor with loud exhaust. The Gt350 with the flat plane crank is music to my ears.
Sorry, Dean... but no joy. I'm a gear-head since forever. I've owned a 104ZS (Google it) and an Alfa 147. I have no problem with hot cars. On the contrary, I love 'em. (Although I have more and more trouble getting into and out of them...
)
I have a problem with fuel prices. I don't like to subsidize stupidly low pump prices, which are bad for so many reasons...
But even if fuel were at the (roughly) $12 / gallon that it would cost without all the subsidies that we give to Big Oil, there would still be a few gear-heads willing to buy a precious tankful from time to time to go have fun with their Ford GT500.
And a good thing it is! The world would be much sadder without such machines!
Most of those will either be stored away as investments or wrapped around a tree when the idiot owner gets over his head with horsepower. Not even traction control can save some testosterone poisoned idiot with that amount of HP under their foot.
Traction control wasn't a feature on my 68 GT500KR and yes, I did wrap it around a tree (telephone pole). I shed tears when I think about what it would be worth today had it survived me.
I just don't see the point of more than 500hp on the street but I'm a 40-something female. I like to drive but there is a point when more HP doesn't make sense, IMO.
500 HP? Anything more than 300 is wasted on the streets where 200 more than gets the job done. I recently traded my 2016 Jeep Wrangler and my vette Olde Blue both of which I loved for a new 2018 Subaru Forrester and couldn't be happier. Do not worry, I got a nice check back from the dealer on the trade so there was that plus in NYC I was getting no mileage. Now even here I get about 25 MPG which is great. I am getting used to it but adaptive cruise control, lane keep assist, blind spot warnings, pedestrian recognition, rear cross traffic alters, front and rear parking assists, cameras, active collision avoidance work fine and I like them plenty. Recently I took a long several thousand mile road trip and did not miss any horsepower but did arrive at my destinations in better shape than I would have in either of my former vehicles. I expect by the time I am ready to trade again complete autonomy will be available though I was expecting to be ready to give up my keys altogether within about that same time frame anyway. So, I'm all for it...
Oh, maybe by 2050 they will be getting a handle on it, but retrofitting a skyscraper with a few solar panels ain't gonna do very much in the cities. A vast percentage of the people live in more rural areas and are too poor for solar, so they'll be busy burning coal for the foreseeable future over there. Under the Paris Accord the US would have paid them to do nothing.
Not much chance that I'm included in the 2%, but at least most of my life was spent breathing Canadian air.
Meanwhile our energy policy is geared toward still concentrated on wasting money chasing the fantasy of the myth of "clean" coal. And denial of Global Climate change. What a wasteful time America is in. You are right. China is so gonna eat our lunch when it comes to Green Tech and it is all our current government's fault.
Weird how the fossil fuel industry and their paid lackeys can still deny global scientific consensus.
It's pretty much stopped warming, and there is no agreement on how much greenhouse gases contributed to the little warming that occurred. And the current sea level rise is only about a tenth of an inch a year. Got to remember we are still in a inter-glacial period following the most recent ice age which wasn't all that long ago.
Seventeen of the 18 warmest years in the 136-year record all have occurred since 2001, with the exception of 1998. The year 2016 ranks as the warmest on record. The earth has not "pretty much stopped warming".
Hmmmm. Four lies in three sentences might just be a record. Trump would be proud.
Sad thing is, there was a time when we were China, leading.
Perhaps had we listened a bit harder to Carter in the seventies, we may have owned renewable energy sources ourselves. Oh well.
Renewables will never be able to satisfy a significant portion of the demand for energy.
In many countries renewable energy already is king. Do the research and rethink your position.
What countries? Facts and figures please.
I am not your research assistant. The truth is out there. Google is your friend.
Albania, Iceland, and Paraguay obtain essentially all of their electricity from renewable sources (Albania and Paraguay 100% from hydroelectricity, Iceland 72% hydro and 28% geothermal). Norway obtains nearly all of its electricity from renewable sources (97 percent from hydropower).
California is on track to be 100% renewable by 2020. Ten years ahead of our self-imposed 2030 goal.
Chicago will power all buildings in the city with renewable energy by 2025.
Atlanta has pledged to be 100 per cent renewable energy by 2035, while the whole state of Massachusetts and Hawaii will follow by 2035 and 2045 respectively.
As fossil fuels are a finite energy source, renewables are the only long term solution. But it won't matter to me, I'll have long been to the other side.
That’s a lie Chicago is not trying to power all buildings just government owned buildings with renewable energy.
Link?
Why do you think that those on the right are so much less intelligent than those on the left? (Why is it that only those on the left have the degree of intelligence required to use Google that way? Perhaps its genetic...???
I am not so sure about that. Remember that the environmentalists don't like hydroelectric because it bad for the dishes, they don't like windpower because it chops up birds and makes upsetting vibrations, they don't like some types of solar because it fries birds. On top of that both solar and wind takes up large sections of land .
If the greenies had their way we would go back to just using candles.
California is on track to be 100% renewable by 2020. Ten years ahead of our self-imposed 2030 goal.
Chicago will power all buildings in the city with renewable energy by 2025.
Atlanta has pledged to be 100 per cent renewable energy by 2035, while the whole state of Massachusetts and Hawaii will follow by 2035 and 2045 respectively.
All the above are wet dreams and high hopes. Projections and predictions are usually way off the mark, just as all the climate predictions have been. There is NO WAY California can accomplish that in two years. They also have a railroad to nowhere in the Central Valley that will never be finished and never paid off. Same goes for Chicago. Fairy tales really don't come true.
Don't need a link...it's called common sense and conventional wisdom. I could explain why it won't, but the facts would be wasted on you.
So you propose punishing Californians for being Californians? Humans have always tended to migrate to coasts.
We scientists would hope science deniers would do just that.
The real problem is overpopulation not energy production, but more solar is a good thing
Renewables can have a major impact, but the sun doesn't always shine nor does the wind always blow. Nuclear can fill the void especially if we look again into the proven technology of thorium and molten salt reactors that don't produce the impossible to dispose of waste material. There are potential options other than trumps coal.
That's why the energy collectors have to be carefully placed and battery storage needs more intensive research.
And BTW to the none believers, I live in California also and steevieGee is right. We are on track to be 100% renewable by 2020. 10 years ahead of our self imposed goal. And we are not some tiny country. We are the 6th largest economy in the world.
So you're saying that the energy needs of every business and residence in the entire state will come from wind and solar...because that's all that is even halfway practical and effective right now....in two years?? I mean 100% is 100%...right??
Dream on...
Yeah it doesn’t pass the smell test. Even the moonbats at Mother Jones are predicting only half of that.
Nobody is saying that coal or oil or natural gas-fired baseload plants will be forced to shut down in 2 years or even 10 years. We still have nuclear and hydroelectric sources and they aren't going away. I'm not sure where you are getting your information from but I'd suggest that you find a source that is more factual and less partisan.
We can build enough wind energy sites that would produce well more than 100%, just to cover those times when the wind isn't blowing at any one site. The fact that we have a nationwide energy grid to balance the power supply with the demand seems to be lost on you.
Randy is correct that energy storage is a huge growth area that could revolutionize how we generate electricity.