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China is increasingly asserting its position as the global leader in green energy. In recent years, the country has achieved extraordinary growth in renewable energy, surpassing the combined capacity of other nations. The installation of solar and wind capacity in 2024 not only broke records but also exceeded the targets previously set for 2030. This achievement marks a major milestone in the global energy transition and strengthens China’s economic and geopolitical influence amid intensifying international competition.

Beijing has successfully built a grand strategy that drives massive investment in clean energy. Throughout 2024, China added 333 gigawatts of solar power and nearly 80 gigawatts of wind power, bringing the total combined capacity to more than 1,400 gigawatts. These numbers not only set new records but also demonstrate an unprecedented pace of transformation. China’s dominance in this sector underscores its serious commitment to securing a strategic position in the future of global energy.

President Xi Jinping’s policies promoting large-scale electrification over the past decade have been a key factor behind this surge. The construction of ultra-high voltage transmission networks, generous subsidies, and heavy focus on research and development have made China not only the largest consumer of renewable energy but also the main producer of the technologies that support global energy transition. Domestic companies now control around 80 percent of the global polysilicon market, a crucial component of solar panels, and have developed offshore wind turbines with a capacity of 20 megawatts, the largest in the world.

Investment in the clean energy sector reached more than 625 billion US dollars in 2024. Green energy contributed more than ten percent to China’s GDP, surpassing the once-dominant real estate sector. This shift not only reshaped the structure of the domestic economy but also positioned clean energy as a new growth engine that underpins national stability.

On the trade front, China’s clean energy exports were worth more than 177 billion US dollars last year. Solar panels, batteries, electric vehicles, and wind turbines became major export commodities, expanding China’s influence across international markets. This dominance has created a global dependence on Chinese manufacturing, leaving many countries struggling to compete due to vast differences in production costs. The cost advantage comes from massive scale and a supply chain that is almost entirely consolidated within China.

However, rapid growth also brings risks. In the first quarter of 2025, several major solar companies reported losses of billions of dollars due to severe overcapacity. Production reached 588 gigawatts, while global demand stood at only around 451 gigawatts. This imbalance pushed prices down and drove utilization rates to just over 50 percent. The government intervened to reorganize the market, ordering companies to curb expansion to avoid a new economic bubble.

Despite its impressive achievements in green energy, China still faces a serious dilemma over coal. In 2024, the country began construction of more than 90 gigawatts of new coal-fired power plants. Coal production reached a record 4.8 billion tons, a sharp increase compared to five years earlier. This sparked international criticism, as it appeared to contradict the climate commitments Beijing had declared on global stages.

Chinese officials argue that these measures are necessary to ensure energy security. Rising electricity demand, especially from the digital economy including data centers and artificial intelligence, requires a stable power supply. The government has pledged to curb coal growth gradually starting in 2026, with significant reductions expected before 2030. Yet environmental observers argue that such efforts are still too slow given the urgency of the climate crisis.

Another pressing issue is the integration of renewable energy into the grid. While solar and wind capacity has soared, the system’s ability to absorb and distribute the electricity remains limited. This has led to curtailment, where renewable power goes unused due to infrastructure bottlenecks. The government is now accelerating the construction of large-scale energy storage facilities and expanding cross-regional grids to mitigate these inefficiencies.

China’s success in dominating green energy carries profound global consequences. The country is not only the leading supplier of clean energy technologies but also expanding its influence through the Belt and Road Initiative. By investing in renewable projects abroad, Beijing has positioned itself as both a strategic partner and a political influencer. This strengthens China’s role in climate diplomacy, particularly in the run-up to global summits such as COP30.

China’s dominance also presents a major challenge for Western nations. The United States and the European Union have responded with subsidies and tariffs on imports, but they continue to struggle against China’s cost advantage and production scale. This has fueled growing debates over green energy trade, raising concerns of a new trade war centered on energy transition technologies. It also highlights the need for diversified global supply chains to avoid overdependence on one country.

For many developing nations, China’s leadership in green energy presents both opportunities and risks. On the one hand, access to affordable renewable technologies accelerates their energy transition. On the other hand, excessive reliance on Chinese products could undermine national energy sovereignty. This paradox is set to remain a critical point of debate in economic and political forums worldwide in the years ahead.

China now stands at a crucial crossroads. On one side, its spectacular achievements in renewable energy cement its role as the global leader of the energy transition. On the other, continued reliance on coal and domestic market imbalances reveal contradictions that are hard to reconcile. The world will closely watch how Beijing balances its clean energy ambitions with the realities of domestic demand. To explore further on energy geopolitics and its impact on the global economy, readers are encouraged to continue to related articles on Olam News covering the intersection of energy crises and international trade dynamics.

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ChinaGeopoliticsGlobal EconomyGreen EnergyInvestmentRenewable Energy