WESTERN governments are seeking to meet their energy needs with new, local facilities to sidestep China's energy supply chains, but experts say it won't be easy or cheap, reports Bloomberg.
Building plants to manufacture solar panels, batteries, and electrolyzers to meet domestic demand in 2030 would cost Europe US$149 billion and the $113 billion.
While those up-front costs evade future geopolitical and natural disaster risks by making supply chains more resilient, PV, battery and electrolyzer manufacturing live in China.
'Western governments are using subsidies and protectionism to expand clean energy manufacturing,'' said Bloomberg New Energy Finance (BNEF) analyst Antoine Vagneur-Jones.
'The sprint to localise may diversify the supply of critical products but represents a wrenching departure from the unfettered free trade of recent years,' he said.
China has invested for decades through low-interest loans, free land, cheap energy, and other subsidies to build the most integrated and efficient clean energy supply chains.
The country hosts 90 per cent of the production capacity for six vital parts of the photovoltaic panel and battery storage value chain and 75 per cent of several other segments.
'No other country has done as much to burnish the energy transition's economics,'' said Mr Vagneur-Jones.
However, the US$374 billion climate act signed into law by US President Joe Biden is expected to boost the development of solar, wind, and big batteries by 20 per cent through this decade.
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Building plants to manufacture solar panels, batteries, and electrolyzers to meet domestic demand in 2030 would cost Europe US$149 billion and the $113 billion.
While those up-front costs evade future geopolitical and natural disaster risks by making supply chains more resilient, PV, battery and electrolyzer manufacturing live in China.
'Western governments are using subsidies and protectionism to expand clean energy manufacturing,'' said Bloomberg New Energy Finance (BNEF) analyst Antoine Vagneur-Jones.
'The sprint to localise may diversify the supply of critical products but represents a wrenching departure from the unfettered free trade of recent years,' he said.
China has invested for decades through low-interest loans, free land, cheap energy, and other subsidies to build the most integrated and efficient clean energy supply chains.
The country hosts 90 per cent of the production capacity for six vital parts of the photovoltaic panel and battery storage value chain and 75 per cent of several other segments.
'No other country has done as much to burnish the energy transition's economics,'' said Mr Vagneur-Jones.
However, the US$374 billion climate act signed into law by US President Joe Biden is expected to boost the development of solar, wind, and big batteries by 20 per cent through this decade.
SeaNews Turkey
