Will the US work with China or in competition with China when it comes to renewables?

When it comes to global renewables, the world has experienced two major wins in recent weeks. Firstly, Democrats lead Joe Biden appears certain to assume office as President of the United States of America in January, bringing with him his “Green New Deal” while Chinese leader Xi Jinping has outlined China’s own “Green Revolution“.

On the surface, this is good news for the world’s environment. China (10.06GT CO2 emissions) and the US (5.41GT CO2 emissions) stand clear as the biggest polluters on the planet and with populations of 1.393 billion and 328.2 million respectively, it is imperative these two global superpowers come to the table when it comes to renewable energy solutions. But while the announcements of these countries have been welcomed around the world, will the two be able to work together for the common good?

China has the technology covered in the renewables space

Around 80 per cent of the world’s solar panels are manufactured in China which means if the US is going to take a leading role in solar adoption, these panels are going to either have to come from China or the US is going to have to establish mass manufacturing plants and supply chains to deliver this technology to its residents.

On top of this, around 80 per cent of the raw materials required to manufacture lithium-ion batteries come from China as well. So we are not talking about just setting up manufacturing plants, but mining operations as well. The US enjoys a strong relationship with Australia where raw materials for these batteries are mined, but would it be enough to supply the entire US?

 

Would the US accept a working relationship with China?

The two superpowers have had a tense standoff with each other for many decades and there was a school of thought that the Obama-Biden administration was not strong enough in kerbing China’s aggression. That means directly working with China could further erode confidence in how this relationship is being managed – but not working with China could mean being locked out of the materials required for the Green New Deal.

 

Hope for an alliance

For President-elect Joe Biden’s Green New Deal to be successful, it is essential that the government learns to trust and rely on China for the resources required.

This has already been highlighted by Tesla moving operations to a massive factory outside of Shanghai where Model 3 electric vehicles are manufactured and shipped to Europe. Tesla has not ruled out producing 100 per cent of its fleet in China in the future.

This works both ways, with Shenzhen-based electric bus maker BYD setting up factories in both the United States and Canada to help electrify public transport fleets. By pooling resources and sharing a green commitment, the United States and China could achieve huge things when it comes to a sustainable future.