UKIP does not represent the majority of the British population. John Major

Energy Copycat

China is keeping a careful watch on Germany: If Germans can combine industrial production with a shift to renewables, the smog over Beijing might soon be a little less dense.

For export oriented nations like Germany and China, security of energy supply and affordable energy price that maintains export competitiveness are the two most critical tasks for the energy industry. But environmental concerns to energy industry have grown steadily in most countries, and are now an integral part of the global call to transit to a low carbon energy sector to tackle the climate change. Environment and safety concerns, including the safe disposal of nuclear waste, saw the demand of phasing-out nuclear and fossil energy gradually become common knowledge in Germany’s energy policy.

The coalition under Chancellor Merkel once hesitated against the “phase–out” of nuclear energy so as to maintain energy independence and cheap electricity but, to some surprise, shifted quickly after Fukushima. The swift and resolute determination to phase out of nuclear energy in Germany (“Energiewende”) after Fukushima sets an example to many nations, including China, who watch closely the progress.

The Chinese government also responded quickly by suspending all new nuclear power plant projects and requested a nation-wide security check for existing actors. This is a serious blow to the Chinese nuclear industry as China then had more than 20 GW (gigawatt) of nuclear power in the pipeline, the largest in the world and expected to target 80-100 GW in the 2020 new energy development plan. As a result, the target was lowered to 60 GW and the three in-land nuclear power plants were postponed in the 12th Five Year Plan despite the fact that they were all under construction.

Given the investment of billions and the nuclear industry and local governments commitment, it is not surprising to hear calls for re-opening the nuclear power feast, which never really faded away in China since Fukushima.

But the Fukushima was not only felt by the government, notable responses were seen in the Chinese community too. Some rumors of radioactive impact alleviation caused a national wave of panicked buying of iodized salt and revealed the widely lacking education for risk associated with nuclear power plants.

Environmental awareness is also increasing on a broad scale. The Chinese have become much more concerned about potential environmental and health threats that they may face. But sometimes it also encourages emotional responses from local people that make the government perturbed. On some occasions, the strong social resistance against environment-polluting investment turned into riots that caused small scale disorder. Local government will have to think twice for any future investment with high environmental risk such as nuclear power plant.

But unlike Germany, this does not seem to be enough for a straightforward “no” answer from the Chinese government to nuclear power.

This is partly due to the energy and climate challenges China faces. China has long aimed for reducing its dependency on dirty coal, especially when the environmental impacts are painfully felt within China, as the recent smog over Beijing spurred huge complaints from thegeneral public, and at the same time its climate implications brings mounting pressures from international communities. Despite their quick development, renewable energy only possesses a small share in China’s rocketing energy demand, and largely thanks to contribution from controversial hydro-power. Thus nuclear power is a difficult potion to be opted-out of in reaching China’s 15% non-fossil energy consumption goal by 2020.

Electricity demand is increasing faster than other fuels in China. Once built, the nuclear generation is stable and the fuel seems always accessible and costless, making it the most convenient and profitable choice for power companies under the current pricing scheme, especially when coal price is high, hydro-power faces increasing discontents, and renewables have yet to become a favorable choice.

But this situation could be altered into an opportunity for renewables.

The recent solar PV panel trade dispute between EU and China, led by a German company, has brought enormous difficulties to the Chinese PV industries. As a response, China steps up the promotion of domestic solar market with favorable policies from both government and State Grid Corporation. However, this also dampened the confidence of many Chinese cities transiting to low carbon energy as they saw it as evidence of Germany backing off from its full support to renewable energy due to the economic slowdown.

What is needed is persuasive evidence in Germany that shows tangible benefits from phasing out nuclear power and developing renewable energy instead. This would be a great encouragement for China to follow suit and up-scale its efforts in renewable energy development

Therefore there is room for more collaboration between China and Germany on renewable energy, so that nuclear power could become a disposable option with more potential success for renewables in both countries. By opening instead of closing markets to each other, providing non-discriminated subsidy and policy incentives to make renewable energy, instead of specific companies the most preferable choice of power generation, and collaborating to bring up, instead of conceal innovation in renewable technology, the two manufacturing giants of the world could do more than just have a head-on competition, but together could bring themselves, and export to the world, a brighter prospect of a low carbon energy future.

The article was co-written with Julian-Jerome Berndt, a research assistant with the Global Intern Program of Carnegie Endowment for Global Peace.

Read more in this debate: Jennifer Morgan, Chris Nelder, John Rhys.

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