China overtook the United States last year as the global leader in clean energy investment while American spending on renewables dropped nearly 40 percent, according to a report to be released Wednesday by the Pew Charitable Trusts.
“The center of gravity in the clean energy world has shifted from the United States and Europe to China,” the report concluded.
China’s leaders are intensely focused on clean energy. The Chinese have aggressive targets for renewable energy and helped bankroll the rapid growth of the country’s solar and wind industries. That resulted in China attracting $65 billion in clean energy investment last year, according to the Pew report, a whopping 30 percent of all renewable investment in the world’s top 20 economies.
China is installing solar because the western European market for its solar products is drying up, said Ethan Zindler, head of policy analysis at Bloomberg New Energy Finance. China is also a major manufacturer of wind turbines and wants to tap its wind resources in Inner Mongolia and elsewhere. China needs energy to fuel its growth and is paying a price for its reliance on coal.
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“There is an interest on the part of policy leaders there to address the terrible quality of the air,” Zindler said.
The United States led in global clean energy investment until 2009. America then traded the top spot with China before reclaiming it during the surge in investment that came along with the stimulus legislation and a record boom in U.S. wind energy construction. American investment in wind skyrocketed as developers scrambled to finance projects before a tax break was to expire at the end of last year.
Congress is keeping the subsidy alive for another year, but scant new U.S. wind energy production is being planned at this point, Zindler said. Now China is in firm control of the global clean energy investment lead while America “continues to underperform,” according to the Pew report.
Pew argues that lack of a national clean energy policy caused the United States to stumble in the clean energy race.
“In the U.S. there is an uncertain policy so investment has declined,” Pew clean energy program director Phyllis Cuttino said in an interview.
Some 29 states have standards requiring utilities to get some of their power from sources like wind and solar. But several states already are surpassing targets, Zindler said, so won’t demand more.
State legislatures also are challenging the renewable energy requirements all over the country, with conservative lawmakers arguing that they should be weakened or repealed.
Pew found investment in U.S. clean energy dropped 37 percent last year. That came even as spending on home solar surged and solar power generation increased in the United States.
The cost of solar and wind energy technology has dropped, so a dollar of investment goes further than in the past.