According to a recent Pew Charitable Trust report entitled, “Who’s Winning the Clean Energy Race,” the United States overtook China in green energy investments during 2011 after lagging behind for the previous two years.
When you add up asset finance, public markets, venture capital, and small distributed investments together, we spent $48.1 billion compared to China’s $45.5 billion.
Part of this growth stems from a number of expiring US incentives. Essentially, developers, manufacturers, and investors in the States rushed to fund pipelined projects in order to take advantage of renewable energy tax breaks and rebates that were about to be shelved.
In other words, green energy bragging rights for 2012 and beyond could very well go back to China now that this last-minute rush is over.
If We Lose Next Year… Who Actually Wins?
In the grand scheme of things, a $3 billion difference in green spending isn’t much. For all intents and purposes, China and the US are neck-and-neck in the renewable energy race.
But is this really a race? After all, races have clear winners and losers.
If you look at the larger picture, any progress in environmental protection or sustainable energy benefits every single person on the planet – even those who make their bread and butter on fossil fuels. Who can argue with cleaner air, more biodiversity, fewer wars, and a healthier planet?
However, if you’re a renewable energy manufacturer in the US, you probably eye China with a touch of disdain. This is especially true if your focus is in solar energy. China has been accused of unfair trading practices, undercutting international competition by artificially lowering its export prices for solar components.
But if you’re anyone else – especially a consumer or solar PV installer – the “winner” of this green spending race may not be as important.
As a consumer, competition is good. Lower prices (artificial or otherwise) are always welcomed. If China spends more this year and US spends more the next, it doesn’t really matter as long as both are spending, developing, manufacturing, and exporting.
As a solar installer, wind turbine technician, or any other type of job that requires on-site maintenance, the indifference is probably similar. It doesn’t really matter where the panels come from as long as consumer and commercial demand continues to create work for you in the here and now.
What consumers and solar PV installers really should be concerned about are the expiring incentives – not the actual “race.” Government support helps to make solar, wind, and other renewables more affordable – regardless of where the technology is manufactured.
So Do Green Bragging Rights Even Matter?
Of course they matter.
The US, with her vast resources and technological leadership should be outspending everyone. We’re only 5% of the global population, but we consume 20% of the world’s energy.
That’s absurd.
And yes, of course bragging rights matter since what happens to American solar manufacturers eventually ripples throughout the economy and affects other industries. Remember the housing crisis and auto manufacturing bust?
But most important of all, solar, wind, and biogas bragging rights matter because more US competition will mean even more Chinese competition – and hopefully – vice versa.
Why is this a good thing?
Because we’re trying to create a greener and more sustainable world. The more that we push each other, encourage each other, and compete with each other, the sooner we all reach that world.