Tom Friedman's NY Times column (Times Select required) today is devoted to China's solar power mogul, Shi Zhengrong, the founder of Suntech Power Holdings, a manufacturer of solar photovoltaic (PV) cells. While describing the mix of government incentives and low labor costs that have helped make Suntech successful, Mr. Friedman laments that we haven't forced US companies along a similar path. Aside from the shaky economics involved in this comparison, Mr. Friedman, generally a supporter of flat-earth free trade, ignores the global benefits of having China in the forefront of the clean-tech revolution. The Chinese aren't the only ones who will benefit from cleaning up China's skies, and reducing the rapid growth of its greenhouse gas emissions.
The concept of technology leapfrogging was certainly exaggerated and over-used in the 1990s, as a way to justify risky high tech investments in developing countries. At its core, though, is an important idea that's equally valid in the world of energy and environmental projects: putting in the best available technology at the start often avoids costly compromises later, and can even save money up front, by avoiding extra infrastructure. With China currently adding the equivalent of the entire UK power grid every year or two, there ought to be plenty of scope for renewables-based distributed power solutions, particularly if companies like Suntech can keep driving down the cost of a PV module. As many US manufacturers have learned the hard way, this is something at which Chinese firms excel.
Given the combination of high energy prices and the growing entrepreneurial focus on clean energy, I'm confident that the US won't lack for green products that match our economic circumstances. Meanwhile, whether it's driven by leapfrogging or by the simple notion that China can't follow the same development path as the US and Europe without stretching global commodity markets and the environment to the breaking point, we should all want China to get very good at deploying alternative energy and efficiency technology. Their need is greater, and the opportunity larger. Let's worry less about whether they're stealing a march on us, in the process.