China's Crash Program for Clean Energy

Originally posted at the Breakthrough Institute

In a forthcoming edition of the New Yorker, journalist Evan Osnos has written a great long essay on the role of the Chinese government in clean energy innovation in China.

Osnos documents how, beginning with the 863 program in 1986, Chinese government officials made a conscious effort to "join the new technological revolution" and make investments in science and technology a priority. Nowhere is this decision more evident today than in the rapid development of clean energy technology in China. In 2001, driven by increasing pollution and concerns over energy security, the Chinese government expanded their investment in energy technology. In 2006, the government expanded their commitment even further, and announced targets for the development of a suite of clean energy technologies:

"In 2006, Chinese leaders redoubled their commitment to new energy technology; they boosted funding for research and set targets for installing wind turbines, solar panels, hydroelectric dams, and other renewable sources of energy that were higher than goals in the United States. China doubled its wind-power capacity that year, then doubled it again the next year, and the year after. The country had virtually no solar industry in 2003; five years later, it was manufacturing more solar cells than any other country, winning customers from foreign companies that had invented the technology in the first place. As President Hu Jintao, a political heir of Deng Xiaoping, put it in October of this year, China must "seize preemptive opportunities in the new round of the global energy revolution."

China's 863 program was modeled in part after the American research system used by NIH and the Department of Defense, the latter of which was instrumental in making early investments in technology that enabled the personal computing and information technology revolutions. And Chinese government investments in research and development (R&D) have been rising dramatically each year:

"R. & D. expenditures have grown faster in China than in any other big country--climbing about twenty per cent each year for two decades, to seventy billion dollars last year. Investment in energy research under the 863 Program has grown far faster: between 1991 and 2005, the most recent year on record, the amount increased nearly fifty-fold."

At the same time, in America, investments in energy innovation were moving in the opposite direction--down:

"In America, things have gone differently. In April of 1977, President Jimmy Carter warned that the hunt for new energy sources, triggered by the second Arab oil embargo, would be the "moral equivalent of war." He nearly quadrupled public investment in energy research, and by the mid-nineteen-eighties the U.S. was the unchallenged leader in clean technology, manufacturing more than fifty per cent of the world's solar cells and installing ninety per cent of the wind power.

Ronald Reagan, however, campaigned on a pledge to abolish the Department of Energy, and, once in office, he reduced investment in research, beginning a slide that would continue for a quarter century. "We were working on a whole slate of very innovative and interesting technologies," Friedmann, of the Lawrence Livermore lab, said. "And, basically, when the price of oil dropped in 1986, we rolled up the carpet and said, 'This isn't interesting anymore.' " By 2006, according to the American Association for the Advancement of Science, the U.S. government was investing $1.4 billion a year--less than one-sixth the level at its peak, in 1979, with adjustments for inflation. (Federal spending on medical research, by contrast, nearly quadrupled during that time, to more than twenty-nine billion dollars.)"

Years of growing energy technology investment have enabled China to catch up with the rest of the world and even exert technological leadership in some clean tech industries, such as carbon capture and storage (CCS):

"When Albert Lin, an American energy entrepreneur on the board of Future Fuels, a Texas-based power-plant developer, set out to find a gasifier for a pioneering new plant that is designed to spew less greenhouse gas, he figured that he would buy one from G.E. or Shell. Then his engineers tested the Xi'an version. It was "the absolute best we've seen," Lin told me. (Lin said that the "secret sauce" in the Chinese design is a clever bit of engineering that recycles the heat created by the gasifier to convert yet more coal into gas.) His company licensed the Chinese design, marking one of the first instances of Chinese coal technology's coming to America. "Fifteen or twenty years ago, anyone you asked would have said that Western technologies in coal gasification were superior to anything in China," Lin said. "Now, I think, that claim is not true."

How do China's scientific advancements affect international efforts to deal with climate change? For all of China's advances, it is still a country with immense poverty and clean energy technologies are still much more expensive than their fossil-fuel equivalents. Until there are cheaper alternatives to coal or oil, solutions to climate change may prove elusive:

"As long as a Chinese citizen earns less than one-seventh what his counterpart in America earns, China is unlikely to back down on the demand that it should be paid to slow down its economy and invest even more in energy technology. And on that point the sides remain far apart."

China's technological advancements, as well as a recent uptick in U.S. energy research funding, may spell a way out of the impasse. Large investments in energy innovation to make clean energy cheap will be necessary to achieve long-term climate objectives and power sustainable global development. One cheap, clean technology that China has pioneered is the electric bike, which Chinese citizens have come to rely on for urban transportation. Osnos ends his piece by describing the simplicity of this new clean tech innovation:

"And yet, for all its imperfections, the Turtle King [e-bike] was so much more practical than sitting in a stopped taxi or crowding onto a Beijing bus that it had become what all new-energy technology is somehow supposed to be: cheap, simple, and unobtrusive enough so that using it is no longer a matter of sacrifice but one of self-interest."

The whole article is well worth a read, and can be accessed here.