Almost two-thirds of the world's solar panels are made in China. China’s government subsidies and protectionist plans reduces the production costs by almost 80 percent. Meanwhile overseas, the U.S. is heavily anchored by subsidies promoting oil and gas research and production. It’s become the world's biggest gas producer while aggressively ramping up export capacity. In 2017, the U.S. became a net exporter of natural gas for the first time in six decades. Industry leaders say they envision a day when natural gas becomes another political and economic influence, rivaling Russia who’s the second-largest gas producer in the world.
While The U.S. has spends heavily on solar manufacturing to catch up, and China has strived to expand its natural gas infrastructure. China's dominance in manufacturing solar panels and America's emergence as the world's largest producer of oil and natural gas could be a potential conflict for other countries ramping up their new energy infrastructure. For developing nations that are a bit more dependent on outside investment for budgets and building infrastructure, might be in a pickle to choose between U.S. gas or buying Chinese-made solar panels. When the time comes, when nations outside of the U.S. and China do choose, it can impact them financially and politically. "We may be looking at the world where people would have to make energy infrastructure decisions based on alliance or geopolitical considerations over system-wide optimal solutions," says Jane Nakano, a senior fellow in the Energy and National Security Program at the think tank CSIS. China, Nakano adds, "has been a consistent supporter of clean energy investment and also innovation, and that could really disadvantage the U.S. remaining in this global supply chain for clean energy."
Which nation is leading the race?
China wants to be the world's largest solar farm in Pakistan (the U.S.'s on-again/off-again ally) while also winning a lucrative contract build a nuclear reactor in Argentina. These projects harness infrastructure and other investments to build Chinese influence globally. For now, in the spheres of gas, solar and other energy sources, there’s wiggle room to overlap investment by the U.S. and China.
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