Art of the Deal.
Instead, the best immediate hope for emissions reduction is China, ironically a vast consumer of coal that has frequently resisted binding carbon targets. Its accidental co-conspirator is Trump, an outright climate change denier. For the past 15 or so years, China has poured trillions of dollars in spending and tax breaks — often buttressed by tariffs and regulations — into renewable energy and other green tech, particularly electric vehicles.
As a massive net oil importer, it was driven more by energy security and strategic industrial policy than global environmental stewardship. Still, the planet should take its wins where it can get them. The increase in oil prices from the Iran war has acted as the world’s most unexpected carbon pricing scheme, with Trump being China’s best salesman. As data from the think-tank Ember shows, sales of green tech have shot up, including in the US, to replace demand for oil. The art of the deal, indeed.
It’s not necessarily being done in a way economists would endorse. You might disapprove of Chinese solar panels flooding the world market as state-subsidised overcapacity, or approve of it as production for a market where rising demand will match supply. Or, like me, you might simply not care either way as long as massively cheap panels are available. The positive externalities of low-cost renewable energy surely exceed the inefficiency from distorting market signals. (More complex technology with security implications, such as electric vehicles, is a harder question.)
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