China has been outspending the rest of the world on clean energy for years now, and new data shows that the investment is paying off in spades. Beijing’s lead in the global clean energy race is wider than ever, according to new figures from the research firm Atlas Public Policy. While gains in clean energy by the world’s biggest greenhouse gas emitter are good news for the entire planet, the increasing concentration of global clean energy supply chains in the hands of just one nation – and an authoritarian nation at that – raises some key geopolitical and energy security concerns for the international community.

Atlas Public Policy analyzed global clean energy investment data between the years 2019 and 2025, and found that more than half of the $1.1 trillion invested came from Chinese companies. In other words, this means that the entire rest of the planet put together spent less than China alone. Compared to China’s more-than $500 billion in investments, the United States, the world’s largest economy, received a relatively paltry $236 billion in clean energy investing, only 40% of which came from U.S. companies, “showing the US dependence on foreign direct investment for its manufacturing sector,” according to the report, published just this month.

While these figures alone are staggering and tell us a lot about the scale and seriousness of China’s ambition to become the world’s first electro-state, the details of the investments reveal even more about Beijing’s energy strategy. A significant portion of China’s clean tech investments – about $136 billion – funded clean tech factories in other countries, “an indication of its strategy to enter new markets and dodge trade barriers” according to a report from nonpartisan news outlet Semafor.

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China has been working toward consolidating global clean energy supply chains and increasing its energy dominance in emerging economies for years now. Beijing’s positioning in the market affords Chinese companies the ability to produce many clean energy technologies, such as lithium-ion batteries and solar panels, at a fraction of the price compared to competitors. As such, Chinese clean tech has become ubiquitous in global markets and particularly indispensable in more cash-strapped nations struggling to transition their energy systems.

And that was all happening way before the United States and Israel started the war in Iran, setting off a global energy crisis that is playing right into China’s hands. Beijing has set itself up better than any other nation on Earth to withstand just such an energy supply crisis. And not only will the Chinese economy be buffered from the fallout, it will come out the other side even stronger as skyrocketing gas prices and energy supply anxieties catalyze the growth of renewables on a global scale.

“For years, clean energy has been sold as a moral imperative. Now it is simply an economic and geopolitical necessity,” an April Forbes report declared. “It’s not about emissions. It’s about resilience and price stability.”

That translates to a major windfall for Chinese clean energy firms. China controls dominant shares of the world’s solar, wind, battery, and EV supply chains, among others, meaning that a surge in clean energy adoption is a surge in Chinese exports. This will lead to an even wider gap between China and the rest of the world when it comes to clean energy manufacturing, with potentially disastrous ramifications for geopolitics and energy security on a global scale.

Writing from a European perspective, think tank Loom released a strategic analysis this month warning not only against increasing China’s leverage on the global stage, but also of the political reaction to that leverage, particularly from the United States. The report notes that “perhaps the most overlooked national security risk arising from Europe’s use of Chinese low-carbon technology comes not from the technology itself, but from the US’s likely hostile response to those who embrace it.”

By Haley Zaremba for Oilprice.com

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