China dominates clean energy manufacturing race, new report says
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According to Advancing Clean Manufacturing Technology, a new report by the International Energy Association, China is solidifying its position as the global leader in clean energy manufacturing. This sector is becoming increasingly vital for economic growth and environmental sustainability.
According to the report, China accounted for a staggering three-quarters of global investments in clean energy manufacturing in 2023. This figure marks a slight decrease from the previous year’s 85%.
Analysis by the IEA shows that the investment in clean technology manufacturing stood at around $200 billion in 2023, marking a 70% increase compared to 2022. Solar photovoltaic (PV) and battery manufacturing plants were the sectors acquiring the highest investments, raking in 90% of the total in both years.
With doubled investments in solar PV manufacturing, China enjoys more than 80% of the global solar PV module manufacturing capacity, demonstrating its dominance in certain clean manufacturing technologies.
Also read: China orders for energy-efficiency plans to meet targets
The report also highlights the possible reasons why China has had such a dominant run in clean energy manufacturing. Recent data and analysis, including evaluations of over 750 facilities at the plant level, have unlocked new insights into manufacturing costs and regional disparities.
The IEA report found that China is the lowest-cost producer of nearly all clean energy manufacturing technologies. It also has policy support and opportunities to reduce cost gaps.
The report highlighted that solar PV, wind, and battery manufacturing facilities in Western nations are 70-130% costlier per unit of output than in China. These costs are calculated before adjustments to the cost of capital between the West and China.
Also read: US and China aim to work together on phase-out of coal despite trade rifts
However, the report also underscored that China’s dominance will face challenges. The report predicts the United States and some European nations will overtake China regarding certain clean energy manufacturing technologies. For instance, if all proposed projects are completed, the US and several European countries might reduce China’s share of battery power manufacturing by 15% by 2030.
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