China Takes Lead in Clean Energy, With Aggressive State Aid (Updated)
The New York Times reports from Changsha, the center of China’s growing green tech industry:
The booming Chinese clean energy sector, now more than a million jobs strong, is quickly coming to dominate the production of technologies essential to slowing global warming and other forms of air pollution. Such technologies are needed to assure adequate energy as the world’s population grows by nearly a third, to nine billion people by the middle of the century, while oil and coal reserves dwindle.
But much of China’s clean energy success lies in aggressive government policies that help this crucial export industry in ways most other governments do not. These measures risk breaking international rules to which China and almost all other nations subscribe, according to some trade experts interviewed by The New York Times.
A visit to one of Changsha’s newest success stories offers an example of the government’s methods. Hunan Sunzone Optoelectronics, a two-year-old company, makes solar panels and ships close to 95 percent of them to Europe. Now it is opening sales offices in New York, Chicago and Los Angeles in preparation for a push into the American market next February.
To help Sunzone, the municipal government transferred to the company 22 acres of valuable urban land close to downtown at a bargain-basement price. That reduced the company’s costs and greatly increased its worth and attractiveness to investors.
Update (Sept. 9 noon PST): The New York Times reports that the United Steelworkers union has filed a complaint against China at the WTO for unfairly subsidizing its green tech export industry:
The filing, more than 5,000 pages long and 18 inches thick, contends that the central government in Beijing and China’s provincial governments have used land grants, low-interest loans and dozens of other measures that violate W.T.O. rules.
Leo W. Gerard, the union’s president, said in a conference call with reporters after the filing that China’s violations of free-trade rules have helped Chinese companies expand their share of the world market for wind turbines, solar panels, nuclear power plants and other clean energy equipment, at the expense of jobs in the United States and elsewhere.
The filing asks the Office of the United States Trade Representative to begin formal consultations with China, which would lead to proceedings at the W.T.O. in Geneva if Beijing did not agree to repeal the subsidies.
“Unless China’s policies are urgently addressed, the U.S. may never get a fair shot at making the green technologies of the future,” the filing said.