DOE Report: China Outpacing U.S. In Global Energy Market

The U.S. Department of Energy (DOE) released its long-awaited study of the economic and national security implications of the Chinese energy demand, which found that China’s incredible 9 percent annual economic growth rate was led by an energy demand that could seriously affect U.S. foreign policy and economic progress.

The report, which was requested by House Resources Committee Chairman Richard W. Pombo (R-CA) in the Energy Policy Act of 2005, was prepared with the Central Intelligence Agency and the Departments of Defense, Treasury, State and Homeland Security. “Without question, this study shows that China is serious about energy,” Pombo said. “The Chinese have figured out that abundant and affordable supplies of energy — in all its forms — are the key to strong economic growth. So they are implementing a goliath of a comprehensive energy policy while we take baby steps. Their incredible growth rate is proof.” While the study revealed that China is taking bold aggressive steps to increase and diversify its domestic energy resources, it also revealed that China is pursuing energy deals with countries around the world, including rogue regimes, said the House Resources Committee. “China is marching forward while we argue inane debates and partisan rhetoric,” Pombo continued. “And China won’t hesitate to march right over us in the upcoming decades if America does not improve its energy policy. We must take similar and aggressive steps to increase American supplies of renewable, alternative and conventional energy to grow our economy. I intend to do just that.” The 70-page report explained the Chinese Communist Party plays a dominant role in policy decision-making and economic affairs at all levels. The government is attempting to meet projected energy needs by increasing domestic-energy production and efficiency, according to the report. For instance, China’s Congress passed the Renewable Energy law in 2005, which legalizes the regulatory framework for renewable energy development, provides economic incentive and financial support for R&D, and promotes construction and utilization of renewable energy facilities. The DOE report highlights China’s steps to increase its domestic energy production, which stand in stark contrast to recent developments in U.S. energy policies. For every pro-energy move in the making by China, the release remarks on America’s inability to do the same, in wind, domestic reserves of oil, offshore production (which in China is growing at an average of 15.3 percent per year), natural gas and LNG, coal, oil shale, refineries, nuclear (on which China plans to spend approximately $50 billion on 30 additional nuclear reactors within the next 15 years), and hydroelectricity (including China’s 18.2-gigawatt Three Gorges Dam project, which is scheduled to be operational by 2009). Another consideration is an amendment by Energy and Commerce Committee Chairman Joe Barton (R-TX), who asked the DOE to review whether a U.S. company would be able to purchase a Chinese company under Chinese law. The Barton amendment came during last year’s attempt by China to buy American-based Unocal.
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