In the US and Europe, the benefits of renewable energy are predominantly seen as environmental. Energy from the wind and sun can offset the need to burn fossil fuels, helping to mitigate climate change.
However, in China and India, renewable energy is viewed in a remarkably different fashion. The relatively rapid transition away from fossil fuels in both countries is driven not so much by concerns about climate change as by the economic benefits renewable energy sources are perceived as conveying.
Indeed, while the economic benefits of renewables can be attractive to advanced economies such as Germany or Japan — both of which are rapidly moving away from fossil fuels — the advantages for emerging industrial giants are overwhelming. For India and China, an economic trajectory based on fossil fuels could spell catastrophe, as efforts to secure enough for their immense populations ratchet up geopolitical tensions. Aside from increased energy security, a low-carbon economy would promote domestic manufacturing and improve local environmental quality by, for example, reducing urban smog.
Illustration: Kevin Sheu
To be sure, fossil fuels conferred enormous benefits on the Western world as it industrialized over the past 200 years. The transition to a carbon-based economy liberated economies from age-old Malthusian constraints. For a group of select countries representing a small slice of the global population, burning fossil fuels enabled an era of explosive growth, ushering in dramatic improvements in productivity, income, wealth and standards of living.
For much of the past 20 years, China and India led the charge in claiming the benefits of fossil fuels for the rest of the world.
However, recently, they have begun to moderate their approach. As their use of fossil fuels brushes up against geopolitical and environmental limits, they have been forced to invest seriously in alternatives — most notably, renewables. In doing so, they have put themselves in the vanguard of a planetary transition that in a few short decades could eliminate the use of fossil fuels altogether.
The economic arguments advanced against renewable sources of energy — that they can be expensive, intermittent, or not sufficiently concentrated — are easily rebutted. In addition, while renewables’ opponents are legion, they are motivated more by interest in preserving the “status quo” of fossil fuels and nuclear energy than by worries that wind turbines or solar farms would blot the landscape.
In any case, those wishing to halt the expansion of renewables are unlikely to triumph over simple economics. The renewable energy revolution is not being driven by a tax on carbon emissions or subsidies for clean energy; it is the result of reductions in the cost of manufacturing that is soon to make it more cost-effective to generate power from water, wind and the sun than from burning coal.
Countries can build their way to energy security by investing in the industrial capacity needed to produce wind turbines, solar cells and other sources of renewable energy at scale. As China and India throw their economic weight into the renewables industrial revolution, they are triggering a global chain reaction known as “circular and cumulative causation.”
Unlike mining, drilling, or extraction, manufacturers benefit from learning curves that make production increasingly efficient — and cheaper. Investments in renewable energy drive down the cost of their production, expanding the market for their adoption and making further investment more attractive. From 2009 to last year, these mechanisms drove down the cost of solar photovoltaic energy by 80 percent and reduced the cost of land-based wind power by 60 percent, according to Lazard’s Power, Energy & Infrastructure Group.
The impact of the rapid uptake in renewable energy could have consequences as profound as those unleashed by the Industrial Revolution. In the 18th century, the economies of Europe and the US initiated the transition to an energy system based on fossil fuels without fully understanding what was happening. This time, we can see the way things are changing and prepare for the implications.
For the moment, the outlook appears promising. Efforts to reduce carbon dioxide emissions might not be the prime driver of the renewable energy revolution, but it is very possible that without the revolution, efforts to minimize the impact of climate change would never succeed. If we are able to avoid the worst dangers of a warming planet, we might have India and China to thank for it.
John Mathews is a professor of strategy at the Macquarie Graduate School of Management in Sydney.
Copyright: Project Syndicate
Recently, China launched another diplomatic offensive against Taiwan, improperly linking its “one China principle” with UN General Assembly Resolution 2758 to constrain Taiwan’s diplomatic space. After Taiwan’s presidential election on Jan. 13, China persuaded Nauru to sever diplomatic ties with Taiwan. Nauru cited Resolution 2758 in its declaration of the diplomatic break. Subsequently, during the WHO Executive Board meeting that month, Beijing rallied countries including Venezuela, Zimbabwe, Belarus, Egypt, Nicaragua, Sri Lanka, Laos, Russia, Syria and Pakistan to reiterate the “one China principle” in their statements, and assert that “Resolution 2758 has settled the status of Taiwan” to hinder Taiwan’s
Singaporean Prime Minister Lee Hsien Loong’s (李顯龍) decision to step down after 19 years and hand power to his deputy, Lawrence Wong (黃循財), on May 15 was expected — though, perhaps, not so soon. Most political analysts had been eyeing an end-of-year handover, to ensure more time for Wong to study and shadow the role, ahead of general elections that must be called by November next year. Wong — who is currently both deputy prime minister and minister of finance — would need a combination of fresh ideas, wisdom and experience as he writes the nation’s next chapter. The world that
The past few months have seen tremendous strides in India’s journey to develop a vibrant semiconductor and electronics ecosystem. The nation’s established prowess in information technology (IT) has earned it much-needed revenue and prestige across the globe. Now, through the convergence of engineering talent, supportive government policies, an expanding market and technologically adaptive entrepreneurship, India is striving to become part of global electronics and semiconductor supply chains. Indian Prime Minister Narendra Modi’s Vision of “Make in India” and “Design in India” has been the guiding force behind the government’s incentive schemes that span skilling, design, fabrication, assembly, testing and packaging, and
Can US dialogue and cooperation with the communist dictatorship in Beijing help avert a Taiwan Strait crisis? Or is US President Joe Biden playing into Chinese President Xi Jinping’s (習近平) hands? With America preoccupied with the wars in Europe and the Middle East, Biden is seeking better relations with Xi’s regime. The goal is to responsibly manage US-China competition and prevent unintended conflict, thereby hoping to create greater space for the two countries to work together in areas where their interests align. The existing wars have already stretched US military resources thin, and the last thing Biden wants is yet another war.