China’s investment in green economy

China’s leaders are investing $12.6 million every hour to green their economy.

So writes Ben Furnas Research Associate at the Center for American Progress Action Fund
Furnass notes that “China is a leading manufacturer of photovoltaic (solar) cells, second only to Japan, and is set to be the world’s leading manufacturer of wind turbines by the end of 2009″ — not exactly low-tech, low-cost production.

A February analysis by HSBC Global Research in Hong Kong projects that nearly 40 percent of China’s proposed $586 billion stimulus plan—$221 billion over two years—is going toward public investment in renewable energy, low-carbon vehicles, high-speed rail, an advanced electric grid, efficiency improvements, and other water-treatment and pollution controls.

This stimulus is on top of historic levels of government spending and private investment in renewable technology, energy efficiency, and low-carbon growth all across China.

This massive stimulus plan will spend over 3 percent of China’s 2008 gross domestic product annually in 2009 and 2010 on green investments—more than six times America’s green stimulus spending as a percentage of our respective economies. This is about $12.6 million every hour over the next two years. In the United States, the American Recovery and Reinvestment Act invests $112 billion in comparable green priorities over the next two years, about half as much as China, according to HSBC. This represents less than half of one percent of our 2008 gross domestic product.

China’s renewable energy industries are already huge and expanding rapidly. China is a leading manufacturer of photovoltaic (solar) cells, second only to Japan, and is set to be the world’s leading manufacturer of wind turbines by the end of 2009.

Take the photovoltaic (solar power) industry. In the 1990s, the United States led the world in the development of solar energy technology. From 1994 to 1998, our burgeoning solar energy industry produced more photovoltaic cells than Japan, China, or all of Europe. But then, in the early 2000s, as the Bush administration stifled global warming data and blocked a renewable energy portfolio standard, America stumbled and fell staggeringly behind.

In a series of energy bills in 2001, 2003, and 2005, the Bush administration plowed billions of dollars into dirty energy—oil, coal, and nuclear—while neglecting clean renewable energy industries. The 2001 energy bill gave 80 percent of its value to tax breaks for oil, gas, nuclear, and coal companies. The 2003 energy bill, drafted in secret with Vice President Dick Cheney and members of the oil, gas, coal, and electric industries, gave $23.5 billion to dirty energy and loosened environmental regulations. Finally, while the 2005 bill contained a token level of investment in renewable energy, it also provided even more support for dirty energy, offering $27 billion in subsidies for coal, oil, and nuclear energy.

The European Union has committed to 20 percent of final energy coming from renewable sources by 2020. China is working to have 16 percent of its primary energy come from renewable sources by 2020. Sixty-six other countries worldwide have committed to nationwide standards. But in the United States, the federal government has set no national standards.

– Ben Furnas climateprogress. 21 Apr 2009