The great green grid of China
Laurence Brahm says Beijing should redouble its push for renewable energy, which would create new opportunities for growth and, in turn, bolster its political sustainability
China is the world's greatest carbon-emitting nation, responsible for much of the greenhouse gases that are quickly destroying our planet. Some 70 per cent of China's energy comes from coal. Hydropower and nuclear account for most of the remaining output, while renewable energy - mostly solar and wind - is a remarkably low 0.7 per cent.
The first response of an economist or businessman might be, "the market is too small, there is no possibility of solar and wind becoming significant power players. Market forces will rule and that means cheap coal." That is only a very short-term perspective, however.
In China, coal is cheap, while solar and wind capacity remains small and issues remain concerning the quality of energy output and scale. Still, these obstacles are technical or technological issues that can be addressed through finance and investment. All these obstacles to the mass adoption of renewable energy as a national priority can be seen as industrial opportunities.
While in the United States research and development is struggling to get costs down, in China the sheer volume of production means it is achieving the same outcome.
The truth is, in a global recession China needs a new economic stimulus. But with all its redundant roads and cement blocks, what is left to invest in? The answer is not another mortar and brick Great Wall, but the Great Grid.
First, massive state investments will be needed to convert China's fossil-fuel-based grid into one based on renewable energy. This will have to be funded by new green bond issues. This comprehensive grid conversion will create waves of jobs, from the most senior engineers to blue-collar workers in every province and region.
