"Based on our research, European companies definitely benefit
from China's green technology market more than US companies," Tan
said in an interview with EurActiv.
"US companies realise this and they now try to catch up."
European companies' stronghold on the Chinese market is evident
in wind energy technology, for instance, according to Tan. "Many
Chinese wind turbine producers don't own key technologies - they
all buy production licences from European companies," she said.
US companies are also failing to benefit from China's massive
clean coal market, and especially supercritical (SC) and
ultra-supercritical (USC) technologies, which make coal-fired power
generation more efficient as Chinese companies mainly purchase the
technology from Siemens, Mitsubishi and Toshiba, she added.
US Secretary of Energy Steven Chu is now trying to play
catch-up with a US-China bilateral technology cooperation
agreement, the researcher said. She singled out carbon capture and
storage (CCS) and buildings efficiency as fields where
the US is keen to tap into the big Chinese market.
It is also eyeing a foothold in the Chinese nuclear power
market, which has long been dominated by the French and the
Japanese, she added.
China has in a very short period of time developed a huge clean
technology market with a systematic strategy, Tan said. The
government first identifies a clean technology that it reckons to
be good for China and then provides direct R&D
support to Chinese universities and companies, she explained.
This was the case for wind energy development, where a
government technology transfer programme was set up in 1996 to
create joint ventures with foreign investors to acquire technology,
according to the researcher.
All the while local partners were given R&D support to
develop their technology capacities, helping companies like
Goldwind and Sinovel to become global leaders in manufacturing wind
turbines, she said.
"In such a short time, China has quickly become a very important
turbine manufacturer in the world. It really benefited from the
government's front-end R&D support," Tan said, which was
"directly [targeted at] those turbine manufacturers," Tan said.
Direct support is coupled with financial incentives for Chinese
companies to buy Chinese-made technologies, the researcher said.
The success of the take-up of SC/USC technology can be partly
explained by government tax credits for plants buying the
technology and mandates obliging new coal-fired plants to use it,
she added.
"China's approach offers the advantage
that it provides investors with long-term certainty that the
government will constantly support green technology
development"
"China's Five-Year Plan and Medium-to-Long-Term Science and
Technology National Plan all have development of clean technology
as a priority," she said. Instead, "US policy depends on the
Congress, which every two years renews its solar or wind energy
initiative," she said by means of comparison.
But accelerating technology transfer has hit the wall on the
thorny issue of intellectual property rights. Tan attributed many
of the problems to China's political and economic structure, in
that many green technology developers are state-owned
enterprises.
In the 1990s when the Chinese were first buying technologies
like USC, purchases were made by a Chinese government agency, which
then handed them on to several state-owned companies, Tan said.
"To Western business practice, that's just wrong because only
one entity can buy a technology, the IPR and then use it; that's
the Western practice. But in the Chinese practice, because the
government owns this - it's like a father and your sons can
naturally use it," she explained.
Such incidents have created distrust among Western technology
owners, who are now less likely to go to China with cutting-edge
technologies, she said. This will create problems for any future
international technology transfer mechanism that might be set up
under a global climate agreement, but Tan said that the market
should remain the basic driver.
"However, considering that climate change is a common
threat, national governments in developed countries should
come up with incentive policies to encourage their multinational
companies to invest in innovating clean technology and give out
advanced clean technology at a faster pace," she said.
In developing countries, more effective policies to deploy
existing clean technology will be needed, she added.
To read the interview in full, please click
here.