Where China can make a big difference to UK’s energy system

Regardless where you live, you would have been aware of the recently agreements for China to be a major investor in Britain’s nuclear power industry. The decision has been controversial to say the least. Whether this is right or not will be argued for many years. But, Geoffrey Lean writes in the Daily Telegraph that Britain should be looking to China for investment in renewable energy. Lean argues that China is already the world’s biggest investor in renewables and it is very much open for international business.


It’s renewable energy where the Chinese can really help us

Much of the talk – and even more of the controversy – surrounding President Xi Jinping’s visit has been about plans for China to invest in reviving Britain’s faltering nuclear industry. But, perhaps counterintuitively, there is much more business to be done with the world’s most populous country over renewable sources of energy.

For, almost unnoticed in Government – and almost entirely so in the media – China has switched to a low-carbon model for development. The country that became famous, or infamous, for building a coal-fired power station a week is now increasingly turning its back on the fuel. China seems to have passed its “peak coal” last year, when use fell by 2.9 per cent, and the trend seems to be accelerating: in the first four months of this year it burned a substantial 8 per cent less than in the equivalent period in 2014.

Renewables, by contrast, are booming. China’s wind power capacity has soared more than 70 fold in decade, while its solar capacity has multiplied more than 300 times over in just the last five years. Over the next five, it plans to more than double again the amount of wind, and almost treble the amount of solar.

Just weeks before George Osborne’s visit to the country last month the official China Daily emphasised that “China’s move to a low carbon future will provide opportunities for companies in the United Kingdom”

All this, admittedly, has come from a low base, but the growth has been so fast that non-fossil fuel sources, including nuclear, already provide a quarter of the country’s electricity, By 2050, according to an official “roadmap” renewables alone will provide 85 per cent of its power, and 60 per cent of all its energy.

Solar and wind, indeed, are soon set to be much more important than nuclear, even though the country is one of the few in the world to be increasing its use of atomic power, with 24 reactors under construction to join its existing 27. By 2020 solar capacity will be almost double nuclear, wind almost four times as much. “Many in the West”, says Isabel Hilton, CEO of the authoritative Chinadialogue, “simply don’t realise the extent to which the Chinese government is betting the farm on a transition towards a low-carbon economy.”

It is high time they did, for there is a lot of business to be done. Already the world’s biggest investor in renewables, China is planning to spend £175 billion in trying to cut its severe air pollution (from burning fossil fuels) by a quarter as early as 2017. And it is actively seeking Western help, with its Premier, Li Keqiang, telling the OECD in June that it was seeking to “buy energy-saving and environmentally-friendly equipment from developed countries”.

“If UK firms do not leap in here, someone else surely will” says Richard Black, Director of the impressive Energy and Climate Intelligence Unit, which has just produced a report on the issue. “All the signals show that China is open for business”.

Indeed, the UK would be turning down an explicit invitation. Just weeks before George Osborne’s visit to the country last month the official China Daily emphasised that “China’s move to a low carbon future will provide opportunities for companies in the United Kingdom”, saying they were “ideally placed to come up with solutions” to its air pollution, and other environmental, problems.

By contrast, the danger is that our supply of low carbon goods and services, now topping £800 million a year, will actually decline because of Government policies now hitting British firms. In the last fortnight, for example, four solar companies have closed, with a loss of 1000 jobs, in anticipation of cuts by George Osborne’s Treasury. Now that really might make you want to go nuclear.

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