Sunday, January 10, 2010

Who’s Sleeping Now?

Developments in China, regarding global issues such as the green revolution, will also impact South Africa in the future.

By THOMAS L. FRIEDMAN

C. H. Tung, the first Chinese-appointed chief executive of Hong Kong after the handover in 1997, offered me a three-sentence summary the other day of China’s modern economic history: “China was asleep during the Industrial Revolution. She was just waking during the Information Technology Revolution. She intends to participate fully in the Green Revolution.”

I’ll say. Being in China right now I am more convinced than ever that when historians look back at the end of the first decade of the 21st century, they will say that the most important thing to happen was not the Great Recession, but China’s Green Leap Forward. The Beijing leadership clearly understands that the E.T. — Energy Technology — revolution is both a necessity and an opportunity, and they do not intend to miss it.

We, by contrast, intend to fix Afghanistan. Have a nice day.

O.K., that was a cheap shot. But here’s one that isn’t: Andy Grove, co-founder of Intel, liked to say that companies come to “strategic inflection points,” where the fundamentals of a business change and they either make the hard decision to invest in a down cycle and take a more promising trajectory or do nothing and wither. The same is true for countries.

The U.S. is at just such a strategic inflection point. We are either going to put in place a price on carbon and the right regulatory incentives to ensure that America is China’s main competitor/partner in the E.T. revolution, or we are going to gradually cede this industry to Beijing and the good jobs and energy security that would go with it.

Is President Obama going to finish health care and then put aside the pending energy legislation — and carbon pricing — that Congress has already passed in order to get through the midterms without Republicans screaming “new taxes?” Or is he going to seize this moment before the midterms — possibly his last window to put together a majority in the Senate, including some Republicans, for a price on carbon — and put in place a real U.S. engine for clean energy innovation and energy security?

I’ve been stunned to learn about the sheer volume of wind, solar, mass transit, nuclear and more efficient coal-burning projects that have sprouted in China in just the last year.

Here’s e-mail from Bill Gross, who runs eSolar, a promising California solar-thermal start-up: On Saturday, in Beijing, said Gross, he announced “the biggest solar-thermal deal ever. It’s a 2 gigawatt, $5 billion deal to build plants in China using our California-based technology. China is being even more aggressive than the U.S. We applied for a [U.S. Department of Energy] loan for a 92 megawatt project in New Mexico, and in less time than it took them to do stage 1 of the application review, China signs, approves, and is ready to begin construction this year on a 20 times bigger project!”

Yes, climate change is a concern for Beijing, but more immediately China’s leaders know that their country is in the midst of the biggest migration of people from the countryside to urban centers in the history of mankind. This is creating a surge in energy demand, which China is determined to meet with cleaner, homegrown sources so that its future economy will be less vulnerable to supply shocks and so it doesn’t pollute itself to death.

In the last year alone, so many new solar panel makers emerged in China that the price of solar power has fallen from roughly 59 cents a kilowatt hour to 16 cents, according to The Times’s bureau chief here, Keith Bradsher. Meanwhile, China last week tested the fastest bullet train in the world — 217 miles per hour — from Wuhan to Guangzhou. As Bradsher noted, China “has nearly finished the construction of a high-speed rail route from Beijing to Shanghai at a cost of $23.5 billion. Trains will cover the 700-mile route in just five hours, compared with 12 hours today. By comparison, Amtrak trains require at least 18 hours to travel a similar distance from New York to Chicago.”

China is also engaged in the world’s most rapid expansion of nuclear power. It is expected to build some 50 new nuclear reactors by 2020; the rest of the world combined might build 15.

“By the end of this decade, China will be dominating global production of the whole range of power equipment,” said Andrew Brandler, the C.E.O. of the CLP Group, Hong Kong’s largest power utility.

In the process, China is going to make clean power technologies cheaper for itself and everyone else. But even Chinese experts will tell you that it will all happen faster and more effectively if China and America work together — with the U.S. specializing in energy research and innovation, at which China is still weak, as well as in venture investing and servicing of new clean technologies, and with China specializing in mass production.
This is a strategic inflection point. It is clear that if we, America, care about our energy security, economic strength and environmental quality we need to put in place a long-term carbon price that stimulates and rewards clean power innovation. We can’t afford to be asleep with an invigorated China wide awake.

7 Opinion(s):

Vanilla Ice said...

South Africa has reached a few "strategic inflection points", and always chosen to do nothing (which is a choice).

Vanilla Ice said...

Friedman is the author of "The World Is Flat". I like him. He got me to kickstart a new venture. I had been pissing in the wind with South African programmers, and after reading his book, I decided to go offshore, to India. Well things changed, and my projects got a life.

FishEagle said...

Glad to hear VI. I also like him.

Anonymous said...

"But even Chinese experts will tell you that it will all happen faster and more effectively if China and America work together —"

And work together they must. How else is China going to get it's hands on the latest in Power generation technology to copy?

The reason why China produces so cheaply, apart from slave labour, is that they don't have to invest in R&D. They wait for countries like America to go through the huge expense and then they simply copy the technology and because they make use of slave labour they are more productive and thus they are always more competitive in the long run. In the end they will own this particular industry as well.
What the West needs, is for the playing field to be levelled. Someone should start a union in China, but of course nobody wants to die, do they? Our Marxist Union creators are anyway only interested in the fall of the West. This is why there is no humanitarian outcry against the appalling conditions of the Chinese labourers.

The US and China have to work together, because the Chinese don't want the R&D expense associated with new generation power generation (haha) equipment. They as always, are waiting for the benefits of having to copy technology without the unnecessary expense. This has been their modus operandi and obviously it has worked so far.

If only the West would realize that those who wants so called co-operation are not their friends at all. They want co-operation for their own benefit only.
A4

FishEagle said...

When I post another global warming post I imagine it will score a big fat zero from readers' ratings. I've never been a proponent of making decisions based on popular opinion though. Democracy SUCKS in SA :)

Anonymous said...

I for one have lost both faith and interest in the global warming/climate change story. Pretty much all of these "crises" have turned out to be idiotic hysteria or else a thinly veiled scam (H1N1 being the latest in the line). Furthermore the utter stupidity of the majority of white people (liberals) means that 3rd world savages will eventually overrun the first world. These care nothing for conserving the environment etc and the world will just end up as a chaotic tribal cesspool. Its a moot point.

Anonymous said...

Well said, Anonymous. They care nothing. White guilt is what the whole world will be living off, in the New Enslavement.

Anon.