The Mega-Big Chinese Clean Tech Market, Talk About Opportunity!

by Terrence Murray - September 14, 2009

Remember the Beijing Olympics? A little more than a year ago the question driving the in the months and days leading to the games was the city’s endemic pollution and whether authorities would ever be able to provide some crucial clean air to the athletes competing there. So, what did Chinese authorities do? Simple, they shut down the polluting factories for the duration of the games. An impressive feat, only possible in a single party state like China.

But the move was just a bandaid solution. Now, China, one of the world’s largest consumers and producers of coal, is taking a more long-term approach to resolving its “CO2 problem.” On the policy side, it has been talking to the world’s other energy guzzler, the U.S., to on climate change issues. On the investment side, in the wake of the global economic crisis, China’s announced a mega $220 billion green-focused stimulus package to prop up wind and solar generation.

Last year, according to the American Wind Energy Association, China added some 6,300 megawatts in wind capacity. The International Energy Agency estimates the country needs to increase its total generation capacity by 800 gigawatts by 2030 to meet demand � roughly double its current capacity.

This is just a start. The much talked about , released last week, estimates that the country’s green energy market, which includes everything from wind and solar farms and battery-powered automobiles, could be worth between $500 billion and $1 trillion a year (yes, that’s per year!) by 2013.

The number is mouthwatering for many clean tech companies. A sliver of that pie could secure a comfortable bottom line for decades.

Already the country’s growing cleantech needs has lead to the creation of some homegrown champions like Yingli Solar. It’s also motivated key foreign players to invest there. Marlboro, Mass., EverGreen Solar is spending up to $20 million to finance the construction of a new 100 megawatt solar panel manufacturing facility in Wuhan, China, it will jointly operate with Jiawei Solar, a local company. And last week Tempe, Ariz. First Solar an MOU with the Chinese government to develop a 2 GW PV farm in the country’s remote Inner Mongolia region. We wrote about that here, impressed by the boldness of the plan, although there are some serious questions about whether First Solar can even execute this mammoth plan. Securing basic materials, including tellurium, on which it relies to build its low cost PV panels will be a major challenge for the company.

On China’s green aspiration, Keith Johnson (quoting the greentech report) writes that the country’s heavy-handed approach offers obvious upsides and some downsides.

China Greentech Reports writes:

The benefits of China�s concentrated and state-dominated greentech markets are offset by poor incentives; lack of competition reduces efficiencies and innovation that come from open and competitive markets. The challenge for any nation, including China, is to know how and when to strike a balance between these two sides [�]

Back to the Beijing Olympics. The government’s decision to just shut down the region’s polluters underscored the upside of that top-hand approach in implementing high impact, short-term policies. However, it probably won’t work to implement a long-term transformative energy policy. At least, that is if China is able to fuel its own innovation based on the intellectual property of outside investors, who are likely to be willing to share proprietary technology for a piece of China’s huge green pie.

7 Responses to “The Mega-Big Chinese Clean Tech Market, Talk About Opportunity!”

  1. [...] clean energy companies, backed by huge stimulus spending in their home market, have been able to develop cheap clean energy solutions, which they’re [...]

  2. [...] have also made it difficult for U.S. clean energy companies to access their lucrative market, estimated at between $500 million and $1 trillion a year — by imposing 70 percent �local content� requirement for wind projects built in China. [...]

  3. [...] Over the next two years, China has committed to invest $220 billion in renewable energy. As part of this massive green stimulus package China seeks to raise its wind power capacity to 100 gigawatts by 2020, or eight times the current level. Some market studies estimate the size of the clean energy market there at nearly a $1 trillion per year. [...]

  4. [...] How important of a player is China in the green energy sector?� Well, for starters�the country plans to spend $220 billion in clean energy over the next two years and the country’s renewable energy market is estimated by some to be worth as much as $1 trillion a year. [...]

  5. [...] A report, released last year, estimates that the country�s green energy market, which includes everything from wind and solar farms and battery-powered automobiles, could be worth between $500 billion and $1 trillion a year. [...]

  6. [...] which has committed more than $200 billion to develop its clean energy portfolio over the next two years, is becoming the “country to [...]

  7. [...] Mass.-based Evergreen, which makes String Ribbon silicon wafers using a proprietary process, is constructing a 100 megawatt solar panel manufacturing plant in China with Jaiwei Solarchina Co., that is slated to open this spring. Tags: Evergreen Solar, [...]

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