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Green innovation in China

Green innovation in China

Avinash Anil Godbole

Energy is a complex issue; it has various dimensions like sovereignty, secure supply, sustainability and local and global impacts attached to it. As a large developing country, China is an important player in this respect. In the last one decade, China has gradually come to occupy the centre stage in various debates of international significance. This is especially true of the global debates on sustainability, climate change and the nature and duplicability of its growth patterns and speed. In this period, China has become the largest consumer of coal and the largest emitter of greenhouse gasses due to its core position in the global production network. China today consumes nearly 50 percent of the coal consumed in the world and it produces about 70 percent of the world’s overall energy basket and almost 80 percent of its electricity.

However, China has also made serious efforts in developing and implementing projects aimed at clean energy sources as a substitute for its heavy dependence on coal. As Lewis argues, China’s wind power capacity registered an increase of over a hundredfold during the priode 2001-2010 from 344 MW to 44,733 MW (p. 1). Lewis rightfully argues that as the largest emitter of carbon, China’s success or failure in clean energy development will have a deep impact on the world politics on climate change, and therefore China’s efforts at developing wind power needs detailed attention. Lewis’ book does exactly that. The book is rich in detail and provides ample inside information about the development of China’s wind power industry.

In addition, as a latecomer to the wind industry, China has had to leapfrog various stages of development in order to arrive at where it is now in such a short time frame. The book’s core focus is on how the state incentivized the development of a local wind power industry, and on the successful case studies therein. This makes this book a must-read for policy makers from other countries that are seeking to expand renewable energy in general, and wind power in particular.

The first substantive chapter looks at China’s energy and climate challenge. It contextualizes China’s energy and emission issues. China’s emissions and electricity demand are linked to its exports and overall position in world trade since 2000-2001. Since China’s industry consumes nearly 70 percent of China’s energy, and since embedded CO2 emissions in exports amount to about 30 percent (p. 11), China’s emissions and energy challenges are truly global in nature. That is why external actors should encourage and support China to transit towards clean development. Here, the author also briefly looks at China’s domestic adjustments and multilateral strategy in response to climate change.

‘Learning by doing’ and adaptation have been the two core strategies used by China in its journey towards becoming a leader in the global wind industry. This has been especially critical for a field that is still under development and for a country that is a relative late entrant. Success of wind power industry has been on the premise of globalization, however, localization and incentivizing local industry as well as innovation have been the commonly used strategies around the world. At the same time, intellectual property is the cornerstone of this niche industry. At another level the economies of scale determine whether or not the industry is likely to succeed. The next two chapters look at China in networks of global innovation and collaboration.. It looks at specific state policies for the spread of wind farms as well as innovation centers within China, and studies the different models that companies like Vestas, Nordex and GE have used as they have survived and thrived in China.

The next chapter looks at thehomegrown Chinese company Goldwind, and its strategies at home and abroad to become one of the largest global players of influence. Goldwind owes its success to a mix of factors, including business acumen, innovation support and encouragement from the government. Goldwind is also a relatively successful model as far as offsets for domestic industry are concerned. However, reliability and quality control issues tend to hurt Chinese domestic manufacturers in this sector.

This book also offers a comparative perspective on the development of wind power in China, South Korea, and India, the three leaders in wind power outside Europe and the US. These are also the countries that have had to adopt leapfrogging as a way to overcome access and time barriers. Knowledge access, business development and government support is what is common to them. Licensing, mergers and acquisitions, and joint developments are some of the strategies adopted by companies from these three countries.

The author concludes the book by highlighting the US-China clean energy cooperation, its structure, and the shortfalls therein. Her general conclusion is that lack of consistent funding, insufficient high-level political support and commitment, and increasing competition hamper the cooperation (p. 179). That is also the reason why many ambitious slogans do not necessarily translate into action on ground.

Overall, it is a useful book for scholars who wish to understand China’s wind power industry in the context of the global debate on climate change. China is already the largest global emitter of carbon and at the same time one of the biggest investors in clean energy technology. The study conducted in this book highlights that successful companies in and outside China have utilized the forces of globalization to their advantage. Technology denials and barriers will ultimately hurt global cooperation on climate change and the fight against rising emissions.

Avinash Godbole, IDSA East Asia Division (avingodb@gmail.com)

Green Innovation in China: China's Wind Power Industry and the Global Transition to a Low-Carbon Economy

Lewis, Joanna I.
Columbia University Press, 2015
978 0 231 15331 7

As the greatest coal-producing and consuming nation in the world, China would seem an unlikely haven for wind power. Yet the country now boasts a world-class industry that promises to make low-carbon technology more affordable and available to all. Conducting an empirical study of China's remarkable transition and the possibility of replicating their model elsewhere, Joanna I. Lewis adds greater depth to a theoretical understanding of China's technological innovation systems and its current and future role in a globalized economy. Lewis focuses on China's specific methods of international technology transfer, its forms of international cooperation and competition, and its implementation of effective policies promoting the development of a home-grown industry. Just a decade ago, China maintained only a handful of operating wind turbines-all imported from Europe and the United States. Today, the country is the largest wind power market in the world, with turbines made almost exclusively in its own factories. Following this shift reveals how China's political leaders have responded to domestic energy challenges and how they may confront encroaching climate change. The nation's escalation of its wind power use also demonstrates China's ability to leapfrog to cleaner energy technologies-an option equally viable for other developing countries hoping to bypass gradual industrialization and the technological lock-in of hydrocarbon-intensive energy infrastructure. Though setbacks are possible, China could one day come to dominate global wind turbine sales, becoming a hub of technological innovation and a major instigator of low-carbon economic change.

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