With millions in venture capital pouring in and a population desperatly hungry for energy, could China be the next big venue for renewable energy? World wide, investors are starting to look seriously at financing Chinese companies that provide renewable energy generation, clean water, food, and energy efficiency. While risky, the massive potential of the Chinese market makes it worth it.
China has a desperate need for energy and one of the dirtiest environments of any country. Clean renewable energy would seem a perfect fit. Firms like Cleantech China, aim to connect investors with start-ups in China.
Its hard to know exactly how much money is being invested in renewable energy in China, but from June 2005 to June 2006, American venture capitalists put $100 million into China-based start-ups focused on alternative energy, double the investment in the period a year earlier, Cleantech China said.
There are many challenges to investing in renewable energy in China. China’s economy runs on fossil fuels(70% coal), and it never slows down. The need for energy is so vast that many wonder what will happen when the Chinese middle class begins to drive cars at a rate similar to America. Also managing investments from overseas in the unique Chinese business culture can be hard or even impossible.
The Chinese government is starting to look seriously towards renewables as an energy source and many foreign companies are eager to provide services to this market of billions. At the same time millions of Chinese are starting to buy cars and China is eager to reduce its need for foreign oil.
If China does become a leader in renewable energy sources it could leapfrog other countries and further solidify itself as a future world super power. With America still painfully addicted to foreign oil, being energy independent would put China that much further ahead. With no large scale established energy grid China still has the chance to build its energy system from the ground up to incorporate renewable energy.
This would mean building gas powered power plants to provide regulating current, large scale energy storage systems, large wind and solar installations as well as their already impressive (and ecologically damaging) large scale dam projects. Couple this with large advances in efficiency, and you would have a bad ass state of the art energy grid.
If China fails to meet its energy challenges with a clean renewable source the world could see pollution and destruction on a level that it has never witnessed. China is expected to eclipse the US as the number one emitter of greenhouse gasses by 2009. This would be devastation on a global scale. It is not only a good idea for China to move towards clean renewables, but may well be a necessity for the rest of the planet.
Could China Be The Next Leader In Renewable Energy?
You bet, China can be the next leader in anything (as long as it picks only one or two things) it wants to set its mind to.
There are some bright individuals and a government with more control than most. The Three Gorges dam may be unpopular but it was China’s admission it needs to wean itself from imported fuel. They also realize they need to wean themselves from polluting fuels but right now that is just icing on the cake, currently cost is the largest factor.
Fortuately, over the long haul, sustainable energy is cheaper energy and the Chinese have an history of long-term thinking (it doesn’t always work but at least they think about it).
Given their large expanse they will be able to implement a variety of solutions. It will be interesting, and probably edifying, to watch them experiment.