China’s Low-carbon Economy Faces Technical Bottleneck

China is fulfilling its commitment to boosting the low-carbon economy. However, this process is somewhat hindered by the country’s lack of core technologies.

In order to realize the goal of reducing greenhouse gas emission made at the Copenhagen Summit last year, China is undergoing a low-carbon reform. The energy-saving and emission-reduction technologies are placed under limelight due to their important roles in this reform. However, China is haunted by the technology-shortage. According to the data from the United Nations, 70% of China’s core energy-saving and emission-reduction technologies are imported from foreign countries. The cost for China to boost low-carbon economy is huge.

Therefore, innovation is necessary during China’s progress towards low-carbon economy. The innovation method, which is based on imported foreign technology and then leads to the final nationalization of technology, is a way worth trying.

Huge Amount of Money in Technology Input

The United Nations Development Program published the “2010 Chinese People’s Development Report – Moving to the Low-carbon Economy and Sustainable Social Development” (hereafter the Report). It is pointed out in the Report that China needs at least more than 60 kinds of backbone technologies to realize its goal of developing low-carbon economy. But 42 of these 60 technologies are beyond China’s sci-tech capability. This means that China needs to import 70% of technologies needed for lowering carbon dioxide emission.

Zou Ji, vice dean of Environment School, People’s University of China and editor of the Report, said that the investment into emission reduction will take 6% of the gross domestic profit in 2050. Therefore, China is obviously haunted by the capital stress from importing these technologies.

The journalist looked through the Report and found that China needs to invest 14.2 trillion US dollars in 40 kinds of technologies related with the departments of energy, steel, cement, transportation, construction and communication between 2010 and 2050 if it wants to realize the goal on time.

Zou Ji said: “We need to form an optimized technological solution and strategy to back us in developing low-carbon economy, because they somewhat decides the level of carbon dioxide emission of China in the future.”

Notable is the way in which China shows its resolution in developing low-carbon economy – instead of sci-tech innovation, it invests a lot of money in the clean energy and some other projects.

The US think tank Pew Research Center issued the report that China has already taken the place of the USA to be the champion in the investment in the clean energy. It is said that China spent 34.6 billion US dollars in developing clean energy while the runner-up, the USA, invested 18.6 billion US dollars.

Zhou Dadi, deputy director of China Energy Research Society, said that China only made great investment in improving the production capacity of clean energy, but it didn’t put a lot of money in technological innovation as reported by the US media.

The raising wind power proves Zhou Dali’s saying. There is one out of three wind turbines in the world installed in China. In China, a new wind turbine is set up every two hours. The National Energy Administration said in a press release in April that the total installed capacity of China’s wind power facilities reached 25 million kWh, the second largest quota in the world. However, the Report said that that China has to import the key components of a wind turbine from outside, including the control system, turbine designs and so on. According to Zou Ji’s estimation, if China continues to import these technologies in the future, it will spend another 785.4 billion US dollars before 2050.

Less Likely for Tech Transfer

At Copenhagen Summit, the developing countries called for the developed countries to transfer their full-grown energy-saving and emission-reduction technology to the developing countries free of charge in order to offset the great amount of greenhouse gas these developed countries had emitted during their development.

However, no breakthrough was made in the Summit and the following meetings of the major countries’ leaders also failed to see consensus in this matter.

“Free transfer is more or less like the developing countries’ own wishful thinking,” said Li Junfeng, deputy director of Energy Research Center, National Development and Reform Commission. “The cooperation on emission-reduction is based on the enterprises with the governments creating the platform. How could the enterprises with the goal of earning profits transfer their technologies free of charge?”

Another expert said that it is quite unlikely for the developed countries to transfer or even sell the core technologies of low-carbon economy to China. “Especially at this time when China’s enterprises have strong manufacturing capability, they usually choose to sell the devices based on these technologies to China.”

It is impossible to rely on foreign countries’ transferring their technology. Therefore, the experts believe that innovation is the only way for China to walk out of the current predicament in energy-saving and emission-reduction technologies.

They even compare the low carbon technology, including the new energy, to the “Industrial Revolution” that significantly changed the world a century ago. “The new energy will be a reform with more significant and profound meaning than the reform to the information technology ten years ago. The steamer led the first industrial revolution, followed by the second one featured with the use of electric power. The third industrial revolution focuses on the information technology and the fourth one is the new energy, which should be the most important reform ever,” said Li Hejun, board chairman of a large state-owned energy company during China’s parliamentary sessions in March.

Jiang Qian, chief researcher of China Investment Consultancy, said that the breakthrough and innovation in nationalizing the energy-saving and emission-reduction technologies are not only the concerns of a single company; instead, the whole country should attach importance to and contribute to this program.

New Pattern Acknowledged

The Chinese nuclear power went through fast development in these years. By the end of 2009, 11 nuclear power plants have been established in China with the total installed capacity of 9.1 million kWh. In addition, there are 24 nuclear power plants under construction and the expected installed capacity is 25.4 million kWh.

The prosperous nuclear power industry is attributed to the self-owned technology. On April 28, a foundation stone laying ceremony for a new nuclear power plant was held in a southern province in China. This new project is based on the CAP1400 technology.

The new technology is developed by importing, digesting and improving the US AP1000 technology. With the independent intellectual property, this technology has made the more powerful nuclear engine possible. According to the expert, the generating output is increased from 1.25 million kWh to 1.4 million kWh. The establishment of this new project is a milestone for China’s nuclear power technology. Wang Binghua, board chairman of the State Nuclear Power Technology Corporation, said: “Our goal is to introduce, assimilate, absorb and renovate the third-generation nuclear power technology and develop the new one with our own intellectual property.”

Zhou Dadi agreed with this development pattern. “The development of nuclear power was once delayed in China. It is hard to make out new things on the current theories. Therefore, we have to realize innovation based on the others’ technologies,” said Zhou Dadi. “Some sample operation and technology can be fully borrowed, based on we can add the Chinese elements to work out something belonging to us.”

There is no windfall in the world. Cooperation in development is the most ideal pattern at present when China is still at the initial period of scientific research in some fields. “China has a big market, added with some attractive policies, can emanate great charm for the technologies,” said Zhou Dadi.

But Zhou also stressed that the cooperation is not the traditional business recruitment, but similar to the cooperation pattern between “Chinese market and American technology”. The ultimate goal is to develop the self-owned technology for China. “If we never get rid of the dependence on the others’ technologies, devices and plants, we are still a productive country instead of a creative country,” said he.

For a long time, China has been harassed by the conflicts about intellectual property when importing technology. Shen Dingli, professor from Fudan University, recalled that many Sino-US trade conflicts were caused by the pure imitation of Chinese enterprises to the foreigners’ products. “We bought some of the products, dismantled them, studied them and then made something similar to them,” said Shen. “This way indeed helped us obtain some foreign technologies at a low cost. But later we have to spend a lot of money in dealing with the lawsuits from these enterprises.”

The new method of “introduction, assimilation and nationalization of foreign technologies” is not accompanied by such conflicts.

The US Academy of World Resource plans to issue a report in July to denounce some US politicians’ accusing of China’s encroachment in the US intellectual property in the clean energy. According to the report, the accusing is nonsense because China got these technologies through self-development and purchasing patent. “Take the SC/USC technology for example. China has become the leader in this most advanced technology in thermal power field. It is also the only developing that wide adopts this technology.”

In addition, the experts think that China should make full use of the favor brought by the national policies to develop their own energy-saving and emission-reduction technologies.

“We have wide market and large space for development. Meanwhile, our government attaches great importance to the low-carbon economy. These all facilitate the development of energy-saving and emission-reduction technologies,” said Zhou Dadi.