China’s substantial investment in renewable energy, especially in wind and solar, is transforming its energy landscape and could aid in poverty reduction. With nearly two-thirds of major global renewable energy projects under construction in China, the shift away from coal would align with global green energy goals by 2030. It also promises economic benefits such as job creation and lower energy costs.

This transition may improve living conditions for low-income communities by reducing pollution and fostering a healthier environment. This highlights the interconnectedness of sustainability and poverty alleviation.

Energy Poverty as a Pressing Issue

Energy poverty continues to be a pressing issue, with more than one billion people unable to use electricity. However, China’s 2013 “Belt and Road Initiative” has facilitated deep-level energy cooperation with 151 countries along this expansive route. This spins regions such as Eastern Europe, Africa and Latin America through outward foreign direct investment (OFDI). Among these regions, nearly 600 million people lack electricity access and the electrification rate in the lowest 20% of countries by per capita gross domestic product (GDP) stands at a mere 56.7 %.

China’s investment in renewable energy shows a promising solution for energy poverty as currently, addressing the issue of energy poverty presents a huge barrier to the achievement of United Nations Sustainable Development Goal 7. This is the goal that seeks to ensure universal access to affordable, reliable, sustainable and modern energy by 2030.

China’s Substantial Investment in Renewable Energy

China is fast becoming a green energy superpower, serving as the leader in investment and installation of low-carbon technology. The nation is motivated by the desire to cut greenhouse gas emissions, boost energy security and catch up with or even overtake industrialized countries in technological innovation. China’s substantial investment in renewables has proven itself extremely successful so far. For example, in 2023, clean energy contributed a record 11.4 trillion yuan ($1.6 trillion) to China’s economy, accounting for all of the growth in investment as well as a larger share of economic growth than any other sector.

In addition, clean-energy sectors were the largest driver of China’s economic growth overall, accounting for 40% of the expansion of GDP in 2023. Moreover, China’s production of electric vehicles grew 36% year-on-year in 2023 to reach 9.6 million units, a notable 32% of all cars produced in the country.

Solar Power

Solar was the largest contributor to China’s economic growth in 2023. It recorded growth worth a combined $140 billion of new investment, goods and services, as its value grew from $210 billion in 2022 to $350 billion in 2023, an increase of 63% year-on-year. Data shows that local government investment in facilities and infrastructure, as well as direct subsidies, added 30% to the reported private investment.

Effects on Energy Poverty

China has made significant progress in addressing energy poverty in the past few decades. This accomplishment has been crucial in replacing the reliance on traditional biomass fuels like wood and dung, which emit harmful greenhouse gases when burned. Despite advancements in electricity access and renewable energy supply, some remote and impoverished areas in China still face challenges related to the quality and reliability of the electricity supply.

Additionally, access to other modern energy sources like clean cooking fuels remains limited in certain regions. With continued efforts, there is hope that these challenges can be overcome.

Conclusion

China’s significant investments in renewable energy are not only reshaping its energy landscape but also have the potential to alleviate poverty. By transitioning from coal to clean energy sources like wind and solar, China aligns with global sustainability goals while enhancing economic growth through job creation and reduced energy costs. This highlights the link between sustainable energy practices and poverty reduction, paving the way for a fairer future.

– Amani Almasri

Amani is based in Durham, UK and focuses on Good News for The Borgen Project.

Photo: PickPik