China’s lead on alternatives is not as significant as it looks

Daniel Yergin, chairman of IHS CERA, the consultancy, is bringing some perspective to the outcry over China’s rapid move to capitalize on the clean-energy economy. The argument is that China, as the world’s biggest solar panel and wind turbine manufacturer, is moving to capitalize on the rush into alternative energy, while the US is falling behind. Certainly, the US is behind.

Congress cannot seem to agree on what legislation to pass to encourage US development of wind, solar, biofuels and any other renewable energy. And these industries are calling for more govermnent assistance, through a Renewable Electricity Standard or more subsidies. A recent study, called, Job Impacts of a National Renewable Electricity Standard, conducted by independent firm Navigant Consulting and released by the RES Alliance for Jobs, certainly backs up their cry for help, noting that without stronger near-term targets than currently envisioned, industries like wind will experience flat job growth and long-term stagnation and the US biomass industry could collapse altogether.

But, despite the failures of the US government to provide significant support for a clean-tech industry, Mr Yergin notes all the discussion about how the Chinese are stealing the leaderhip in this area is overplayed. In his own words:

It’s not that they will have a secret elixir or the key to the technology. They’re going to have the same advantage they have on everything else. And that is that low-cost manufacturing. To compete with the Chinese, the US will have to compete on quality and service for such equipment as wind turbines and on creativity and ingenuity for new innovations.

The bottom line is that, in the area of clean-energy quality and service, the US can still provide leadership. It is unlikely to come from the government, however, so industry must continue forging ahead on its own.

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