· 5 min read
Has sustainability gone soft again?
ESG funds just experienced net outflows globally for the first time ever, with US investors alone pulling $5bn in Q4 2023.
Republicans other resurgent rightists are teeing up for 2024’s record election schedule with ‘woke capitalism’ in their crosshairs.
Coalitoons like the Net-Zero Insurance Alliance and Net Zero Asset Managers initiative have lost giants like AXA and Vanguard.
Just a few years ago it felt like we had firmly won the debate on pragmatic as well as moral grounds. Politicians and businessfolk were queuing up to argue for the business case of the century. Today, it feels like we’re riding out a major backlash, particularly amongst hard-nosed former allies. Will climate become the preserve of (as Trump would have it) sandal-wearing hippies and bleeding-heart libs again?
These ructions shouldn’t surprise us. The West has long been riven by contradiction; the ESG boom of the last few years only papered over them for a moment. As anxiety over American decline ratchets up, old arguments are bound to return. And who said America was a good guide to the future anyway? For a clearer picture of where ESG is headed, I think we can do better.
How about a trip to China?
East laps West
Here’s a stat to blow your mind: In 2023, China’s new solar installations (217GW) outweighed the total solar capacity of the US (175GW).
Read that again. Let it sink in.
Across a single year, China added an America’s worth of panels. That’s an outrageous rate of growth.
Here’s another fact that to hold in your head at the same time: last year, carbon emissions from the Chinese power sector grew by more than 5%.
This is the truth of the moment we are in today: we are both making more progress than ever before, and not doing nearly enough. But our media barons and political strategists believe that nuance doesn’t sell, which is why we are only ever (alternately) saving or destroying the world.
Nonetheless, the real message in China’s policy is that net-zero is the only future worth preparing for. Here’s why we should take that seriously.
The Chinese compass
Firstly, this is a nation run by engineers. A few years ago, all 9 of the Politburo had engineering degrees, and some 80% of leaders at all levels of Chinese government were science or engineering graduates. That means a respect for science and the value of investment. This is a country that announced a new $1 trillion infrastructure plan in 2022 without even blinking. If they are getting behind green investment, it suggests the rational argument is settled.
Secondly, the Chinese Communist party is obsessed with growth. They understand that prosperity is their central source of ex-democracy legitimacy, and they will do everything in their power to maintain it. Pro-growth Westerners could do worse than copy-trade someone betting their life savings! Clean energy accounted for 40% China’s GDP growth in 2023 too – this is no jam tomorrow.
Finally, the Chinese leadership thinks very carefully about the future. The idea they think in centuries may be a Western myth, but 2050 is more of a reality in the Chinese imagination than it is here. 2049 will mark the centenary of the Republic of China and the halfway mark of Xi Jinping’s Chinese Century, by which time the government has promised ‘to build a modern socialist country that is prosperous, strong, democratic, culturally advanced and harmonious.’ We can argue the definitions, but the horizon is real; Chinese energy policy intends to prefigure mid-century reality.
To overcome or succumb?
China suffers its own contradictions, of course. The Party obsession with economic prosperity increasingly relies on debt-fueled stimulus binges. The rule of the engineers is waning as more political scientists, economists and business leaders are appointing to high office. And plenty of China’s policy mistakes of recent years – from Covid to Hong Kong – betray the same short-termism that bedevils the West.
Nonetheless, China remains defined by a combination of ambition, sacrifice and awe-inspiring can-do. The party’s vision of national culture is a fusion of Mao’s Long March and Deng’s Open Door.
The results are everywhere to see, particularly in their record-breaking megaprojects. The world’s fastest bullet train runs at 450kmph between Beijing and Shanghai. The worlds longest underwater tunnel – an 11km, 6-lane highway – connects Shanghai and Nanjing. The Huangzhou Bay bridge is the world’s longest too, a 35km open-water marvel between Jiaxing and Ningbo.
The same ability to execute radical plans marks the darker side of Chinese policy, too. The social credit system, facial recognition surveillance, and the genocide/crimes against humanity in Xinjiang (in the words of the US and UK governments, and a UN report) also demonstrate that when China’s technocrats decide something, they make it so.
This is the context in which we should understand China’s clean energy policy – a statement of fact, not an idle hope or open question. Ironically, this belief that we could summon the future in our image was once the preserve of the West; the American Century was punctuated with megaprojects that almost have a CCP ring, from The New Deal and The Great Society to the Apollo Project.
No longer. Any superpower will suffer its contradictions – what separates rising from declining powers is whether they overcome, or succumb, to these forces. If the West, particularly on the right, really believe that China intends to challenge for their crown, they might want to take the Chinese vision of the future more seriously. Even hawks should want to compete on ESG, rather than simply abandon the field of battle.
And that means building more solar panels. A lot more.
illuminem Voices is a democratic space presenting the thoughts and opinions of leading Sustainability & Energy writers, their opinions do not necessarily represent those of illuminem.
