Why China balked on a climate deal

Rather than focusing on the threat of climate change, which is real, the President should come home and focus on the economic opportunities we have before us and the market incentives we need to seize them.

Opportunity.

As Evan Osnos detailed recently at The New Yorker, China is spending billions on new renewable technologies.

The investments being made there dwarf those being made in the U.S. They can command supply, while we must wait for market incentives to make production profitable. As Osnos noted in an online chat at his Web site, China has actually produced ahead of market demand in wind turbines and solar cells.

China's insistence on being treated as a developing country, and avoiding transparency on emissions, may have nothing to do with a lack of urgency on climate issues. A draft political agreement now making the rounds is vague on all details, but such an agreement would still be a concession.

Fact is while some conservatives still insist on calling the country Communist China, and it remains nominally a one-party Communist state, China continues to behave in a highly capitalist manner.

So let's look at this the way they do, as a market opportunity.

At stake is a massive global market for renewable solutions. We are talking here about more than solar cells, wind turbines, and the smart grid. We are talking about simpler things like stoves that are more efficient and are affordable by very poor people.

Much of the leadership in this market is European, he notes, but there are American entrepreneurs doing things like the LuciaStove (above) and the BioLite Rocket Stove. Keeping such products out of mass production would push their creators toward Chinese manufacturing.

LuciaStove, for instance, is looking to produce in 500-unit lots and set up micro-industries in small communities. But this could be a big seller at Home Depot or at Bass Pro Shops. Hunters are always looking for ways to keep warm for less. They should be producing in 5 million unit lots.

Regardless of what happens (or what does not happen) at Copenhagen, there is a huge and growing demand for efficiency, and for energy solutions that don't require imports of raw materials. Hard targets would stimulate more American investment, so why should China give its rival what it seeks?

What Americans still fail to understand is that this should be about business and national security, not about "going green," because those motivations are stronger and more likely to deliver concrete results, and because in fact renewable technology is good business.

Rather than focusing on the threat of climate change, which is real, the President should come home and focus on the economic opportunities we have before us and the market incentives we need to seize them. People win when they compete but lose when they sacrifice.

So compete.

This post was originally published on Smartplanet.com

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