Report: China overtakes U.S. as best country for green investors
The same day this week that The New York Times published an extensive report by correspondent Keith Bradsher on China’s massive subsidies for renewable energy companies, Ernst & Young released a study showing that, not surprisingly, China has overtaken the United States as the most attractive place for green tech investment.
“China’s steady rise to pole position has been underpinned by strong and consistent government support for renewable energy,” Ben Warren, Ernst & Young’s environment and energy infrastructure advisory leader, said in a statement. “This, together with substantial commitment from industry and the sheer scale of its natural resources, means that its position as top spot for renewable energy investment is well merited.”
Some of that government support may violate World Trade Organization rules. On Thursday, an American union, the United Steelworkers, filed an unfair trade complaint against China with the Office of the United States Trade Representative.
But the Ernst & Young report points to failures on the part of the U.S. government to take action that would attract green investors.
For one thing, Congress has so far failed to establish a national Renewable Energy Standard that would require the country’s utilities to obtain a certain percentage of electricity from non-carbon-emitting sources.
Also, a federal tax subsidy program that is spurring construction of big solar power plants expires at the end of the year and legislation to extend the incentives is languishing in Congress.
“Although the United States remains a highly attractive location for investors in renewable energy, it is clear that recent events have eased momentum,” said Warren. “The U.S. market continues to have significant potential but requires consistent legislative support to provide investors with the long-term confidence they need.”
China, in contrast, “aims to reach an installed capacity of 300GW [gigawatts] of hydro, 70GW of nuclear, 100GW of wind, and 20GW of solar capacity by 2020,” according to the Ernst & Young study.
Reports by the U.S. Energy Information Agency provide a glimpse of the green imbalance of trade between the two countries. The figures from 2008 — apparently the latest available from the government — show that fewer than 1 percent of U.S.-made solar modules were shipped to China while nearly 23 percent of Chinese-made photovoltaic modules were exported to the U.S.
Since then, Chinese imports have risen dramatically. At the end of 2009, for instance, Chinese firms supplied about half the California solar market alone, according to Bloomberg New Energy Finance, a consulting firm.
What China is not exporting, of course, is green jobs.