Chen Yushi is an Invited Researcher at TianGong Think Tank, Research Institute for Environmental Innovation (Suzhou), Tsinghua University.
 

Breakthroughs in clean energy, electric mobility, and smart infrastructure are transforming the way economies operate and societies address climate change.

 

As the world’s largest energy consumer and carbon emitter—responsible for roughly one-third of global CO₂ emissions—China’s actions are pivotal for the planet’s sustainable future. Yet China is not only a source of emissions, for it has also become a leading source of solutions. The country has rapidly scaled up renewable energy, electric vehicles, and other climate technologies at an unprecedented pace, leveraging its vast industrial base and digital prowess. This convergence of sustainability, technological innovation, and global engagement amounts to a triple transformation—decarbonizing its economy, digitizing its energy systems, and reconfiguring international cooperation—that is reshaping global efforts to address climate change.

AI tea-picking robots wearing solar-panel hats in Longjing, China | Source: Guliver Image

 

China’s pivotal role in the process stems from deliberate policy choices and massive investments. In 2020, China announced ambitious “dual carbon” goals: to peak CO₂ emissions before 2030 and achieve carbon neutrality before 2060. This marked a watershed moment in aligning China’s development trajectory with global climate objectives. Achieving these goals is daunting for a nation of China’s size, but it is driving a nationwide mobilization of resources toward clean technology. The government’s vision of an “ecological civilization” has been embedded into national plans, with climate mitigation and innovation now core themes of economic strategy. Emerging technologies—from solar and wind power to artificial intelligence—are seen as strategic sectors that can simultaneously advance China’s growth, energy security, and environmental quality. As a result, China is pouring funding and talent into climate tech on a scale rivaling or exceeding that of any other country.

 

China’s climate tech revolution is not happening in isolation. The country’s vast manufacturing capabilities and outward investment mean that Chinese advancements quickly ripple across global markets. Affordable solar panels, batteries, and electric buses made in China are helping countries around the world accelerate their own green transitions. Through initiatives like the Belt and Road and various bilateral partnerships, China is exporting sustainable infrastructure—a process of reglobalization that is forging new links in clean energy supply chains. Meanwhile, China’s strength in digital technology—from big data to AI—is being harnessed to optimize energy systems and improve climate resilience. In short, China stands at the nexus of three transformative forces: a domestic pivot to sustainability, the integration of digital intelligence with clean energy, and a reorientation of global trade and cooperation around climate technology.

 

China’s Green Leap

China’s government has engineered a rapid “green leap” through bold policies and an innovation-focused development model. China is expected to invest about $6 trillion in climate-related and digital infrastructure during the period pertaining to the 14th Five-Year Plan (2021–2025).

 

Green industrial policies—such as subsidies, tax incentives, and government procurement—have nurtured domestic clean-tech sectors from solar photovoltaics to electric vehicles. Since the late 2000s, programs like “Made in China 2025” and strategic emerging industry initiatives have identified renewable energy and new-energy vehicles as priority areas, channeling state support and R&D funding into them. The result has been a dramatic scaling up of China’s clean technology capacity over the past decade, turning the country into a global leader in both the deployment and manufacturing of climate solutions.

 

China’s innovation-driven approach is evident in its staggering growth of research and development (R&D) spending and patent filings in clean energy fields. For example, in 2022, China spent nearly 3.09 trillion yuan (about $456 billion) on R&D, roughly 2.55 percent of GDP—a share that has risen each year. Over the past two decades, China’s share of worldwide clean energy patents surged from virtually negligible levels to over 75 percent today. Far from merely “imitating” foreign technology, China has become an innovation powerhouse in its own right, pioneering ultra-efficient solar cell designs, long-duration energy storage systems, and new nuclear reactor concepts. This immense domestic innovation pipeline underpins China’s climate tech revolution.

 

At the same time, China has leveraged its formidable manufacturing base to achieve unrivaled scale in clean technology deployment. The country has been installing renewable energy capacity at record-breaking rates. In 2024 alone, China added an astonishing 356 GW of new wind and solar power capacity, reaching a cumulative 1,200 GW of solar and wind six years ahead of its 2030 target. This rapid buildout means China now accounts for nearly two-thirds of all large-scale solar and wind projects under construction worldwide. Solar power is a particular success story: China connected roughly 278 GW of new solar PV in 2024, accounting for well over half of all solar capacity added globally that year.

 

Moreover, Chinese companies have dramatically driven down the price of solar panels—by over 80 percent in the past decade—through economies of scale and supply chain integration, making solar the cheapest power source in many regions. China has also created the world’s largest electric vehicle (EV) market. In 2022, more than 5 million EVs were sold in China (around 60 percent of global EV sales), and domestic EV makers like BYD and Li Auto have become internationally competitive. China’s cities now boast fleets of electric buses and taxis, with Shenzhen becoming the first city in the world to electrify 100 percent of its bus fleet—improving urban air quality while cutting oil demand.

 

China has also surged ahead in energy storage and battery technology, which are critical for balancing renewable grids. Chinese firm CATL is the world’s largest lithium-ion battery producer, supplying not only domestic EVs but automakers globally. By building vast battery gigafactories, China commands an estimated 70 percent of global battery manufacturing capacity. This dominance extends across the supply chain—from mining and processing of critical minerals like lithium and cobalt, to battery cell production and even recycling.

 

On the heavy industry front, China is exploring pathways for industrial decarbonization. Dozens of pilot projects are underway for green hydrogen production, which can be used to produce steel with drastically reduced coal use. Major steelmakers such as Baowu and HBIS have begun testing hydrogen-based iron reduction furnaces, aiming to produce low-carbon “green steel.” It is projected that China could produce 15-20 million tons of green steel annually by 2030, based on the current pipeline of announced hydrogen-based projects.

 

Underpinning this progress is a deliberate synergy between government, academia, and industry. The state sets high-level goals and provides funding, while a dynamic private sector competes and scales up the solutions. Companies like Goldwind, BYD, and LONGi Solar have become global tech leaders thanks to this environment. China’s “green leap” is the result of strong policy signals (dual carbon goals, five-year plans), heavy R&D and industrial investment, and an ability to achieve scale. By combining policy direction with innovation drivers, China has rapidly transitioned from a follower to a frontrunner in climate technology. Yet this transformation is not confined to China’s borders; it is increasingly shaping global clean energy trends through trade, investment, and partnerships.

 

Digitalization and Energy Transition

A defining feature of China’s climate tech push is the integration of advanced digital technologies—notably AI, big data analytics, and the Internet of Things (IoT)—into energy and environmental systems. This digital and intelligence layer is accelerating the clean energy transition by improving efficiency, reducing costs, and enabling smarter management of resources. These innovations hold promise not only for mitigating emissions but also for adapting to climate impact.

 

One of the most impactful areas is smart grid and power system optimization. Managing an electric grid that incorporates hundreds of gigawatts of intermittent solar and wind power is a complex task. China is meeting this challenge by deploying IoT sensors and AI algorithms throughout its grid infrastructure. The State Grid Corporation of China (which runs most of the country’s grid) has installed tens of millions of smart meters and sensors that feed real-time data on electricity usage and flows. Using AI-driven analytics, grid operators can forecast demand spikes, identify bottlenecks, and adjust power flows more efficiently than ever before. For example, China’s vast ultra-high-voltage (UHV) transmission lines, which carry renewable power from resource-rich western regions to eastern cities, are equipped with smart control systems to balance loads and prevent outages across thousands of kilometers. In effect, China is building a “smart spine” for its power network, where digital technologies ensure that clean energy is delivered where and when it’s needed with minimal waste.

 

AI is also revolutionizing predictive maintenance and operational efficiency of clean energy assets. Chinese wind farm operators use machine learning algorithms to monitor turbine performance and detect anomalies that might indicate a looming fault (such as unusual vibrations or temperature changes). This allows maintenance crews to fix or tune equipment before a breakdown occurs, reducing downtime and raising the capacity factors of wind farms. The rise of virtual power plants in China—aggregating distributed resources like rooftop solar, batteries, and flexible demand via cloud platforms—relies on AI to orchestrate thousands of endpoints to act as one, supplying power or reducing load on command. Cities like Hangzhou and Shanghai have launched pilot programs where intelligent energy management systems coordinate building HVAC systems, EV charging stations, and small solar installations to reduce peak loads, cutting the need for coal peaker plants.

 

Beyond energy supply, digital intelligence is helping reduce energy demand and emissions in China’s industries and cities. In manufacturing hubs, IoT systems track the energy consumption of machinery in real time, enabling companies to identify inefficiencies and retrofit processes. AI-driven control systems in steel mills and chemical plants adjust variables to minimize fuel use and emissions while maintaining output. For example, Baosteel implemented an AI system to optimize the furnaces in one of its steel plants, reportedly cutting coke use by a few percent—a small but significant reduction given the scale of production and emissions.

 

Nevertheless, the embrace of digital intelligence in the energy sector brings its own challenges and considerations. One concern is the energy footprint of digital technologies themselves—training large AI models and running data centers can consume substantial electricity. As AI deployment grows, Chinese tech companies are working to improve data center energy efficiency and power them with renewables (some data centers in China are now being built next to wind and solar farms or using waste heat for district heating). Another issue is cybersecurity: a highly networked grid with IoT sensors could be vulnerable to hacking or disruptions, so China is also focusing on grid cyber-defense and robust control protocols. Finally, there is the human factor—using AI to augment human decisionmaking requires skilled operators and trust in the algorithms. China is investing in education and training for “energy intelligence” professionals who can bridge power engineering and data science.

 

In conclusion, digital intelligence acts as a force multiplier for China’s climate tech revolution. By leveraging AI and data, China is able to deploy renewables more effectively, keep its sprawling energy system stable with a high share of clean power, and extract efficiency gains across the economy.

 

China’s Global Climate Tech Influence

China’s domestic climate technology boom is reshaping global trade dynamics and intensifying the push toward a new form of globalization—often termed “re-globalization”—centered on clean energy. This shift sees China emerging as a pivotal nexus connecting diverse markets through the export of affordable solar panels, electric vehicles, and lithium batteries. For instance, China’s dominance in solar manufacturing—from polysilicon production to panel assembly—has significantly reduced renewable energy costs globally, with Europe notably relying on these imports to meet urgent climate objectives. Similarly, China’s rapid ascent to the status of the largest global exporter of electric vehicles underscores its influential role in accelerating global decarbonization efforts and intensifying international competition.

 

The underlying cause of current trade tensions and accusations of overcapacity, particularly from Europe and the United States regarding China’s “new three” climate-tech exports, stems from the legacy of hyper-globalization. This previous global economic order was characterized by a clear horizontal division of labor, where Western nations specialized in high-value innovation and branding, while Asian economies, particularly China, focused on high-volume manufacturing. Although initially beneficial, this arrangement inadvertently contributed to global economic and social inequalities.

 

The backlash against these inequalities gave rise to the current phase of re-globalization, marked by two primary developments. First, Western nations, driven by domestic voter pressures and economic nationalism, began reshoring manufacturing capacities to bolster local employment and reduce reliance on foreign production. Europe, grappling with industrial hollowing-out, exemplifies this trend through policies such as the Battery Act and the Critical Raw Materials Act, which aim to reestablish local production capabilities and ensure strategic autonomy in essential sectors. Second, East Asian economies, notably China, evolved beyond simple manufacturing hubs toward innovation-driven and brand-focused economic models, directly competing with Western industries.

 

This shift has significantly disrupted the global market equilibrium. China’s growing capability to satisfy its own market demands with domestic brands has diminished Western companies’ outsourced production, triggering excess capacities in Western R&D and manufacturing sectors and thereby threatening jobs and economic stability. Concurrently, Europe’s protectionist responses—though understandable from a domestic employment perspective—have intensified trade frictions and increased costs, contributing to inflationary pressures.

 

A practical resolution to these issues lies in reshaping China-Europe collaboration to address mutual concerns strategically. A cooperative approach involving direct Chinese investment in European manufacturing—such as joint ventures, research collaborations, and factory establishments within the EU—could effectively address European anxieties about strategic autonomy and industrial resilience. Simultaneously, China could leverage Europe’s advanced technological standards to enhance its own innovation capacities.

 

Moreover, China-Europe partnerships could extend into developing countries through joint infrastructure investments, thereby redistributing excess production capacity more equitably and sustainably. Such collaborations could facilitate climate technology transfer and bolster infrastructure projects in Africa, Latin America, and Southeast Asia, aligning economic benefits with shared global climate goals.

 

In essence, climate-focused re-globalization presents a viable and constructive pathway forward. By fostering strategic cooperation between China, Europe, and developing regions, this approach not only addresses existing industrial imbalances and protectionist tensions but also aligns global economic imperatives with pressing climate objectives.

 

Beyond trade, China is playing a prominent role in financing and building low-carbon infrastructure overseas. Through the Belt and Road Initiative (BRI) and other international programs, Chinese entities have invested in energy projects across Asia, Africa, and Latin America. Notably, there has been a significant shift in China’s overseas energy finance in recent years from fossil fuels toward renewables. In Southeast Asia, for instance, Chinese firms that once built coal stations in countries like Indonesia and Vietnam are now involved in wind farms, solar parks, and hydro dams. A Wood Mackenzie report found that 47 percent of China’s new Belt and Road energy investments were in renewables by 2022—up from just 19 percent a decade earlier. Among completed BRI power projects to date, renewable projects (solar, wind, hydro) account for roughly 37 percent of capacity, and this share is rising. Indonesia and Vietnam were top recipients of Chinese energy investment over the past decade (each receiving around $24-25 billion, heavily weighted to coal earlier), but now Chinese partners are pivoting to support these countries’ clean energy goals. For example, Chinese companies are helping Vietnam expand its wind power capacity (including one of Southeast Asia’s largest offshore wind farms), and in Indonesia, Chinese firms are investing in EV battery supply chains to utilize the country’s nickel resources—a collaboration that could help Indonesia electrify transportation.

 

China’s global climate tech influence also extends to international institutions and initiatives. It has co-founded platforms like the BRI International Green Development Coalition to promote environmentally friendly BRI projects and announced a South-South Climate Cooperation Fund under the UN framework to assist developing countries (supporting projects such as early warning systems and solar lighting). In multilateral fora, China has positioned itself as a champion of developing countries’ access to clean technology. For instance, at the G20 Summit in 2023, China endorsed a roadmap to increase clean energy investment in developing economies, emphasizing innovative financing and the need to triple concessional climate finance. Chinese development banks are increasingly coordinating with institutions like the World Bank and the African Development Bank on co-financing renewable projects, blending public and private capital.

 

Of course, China’s overseas foray into climate tech is not without strategic underpinnings. By establishing itself as an indispensable supplier of green hardware and know-how, China gains geopolitical goodwill and secures markets for its industries. In many emerging economies, Chinese firms are setting technical standards for solar panels, grid equipment, and electric vehicles—potentially giving China long-term economic influence. This has raised some concerns in the West about over-reliance on China for critical clean energy components (akin to the debates over dependence on Chinese telecom equipment). The European Union, for example, is working on plans to onshore more solar manufacturing to reduce the 80+ percent import share from China, and the United States has imposed tariffs on Chinese solar technology and batteries in the name of fair trade and supply chain security. Such tensions have led experts to call for a “clean tech détente”—an understanding between China and Western powers to cooperate on climate goals while managing competition in a way that does not hinder the green transition.

 

Sustainability Challenges and Opportunities

While China’s climate tech revolution has achieved remarkable gains, it also faces a number of sustainability challenges and dilemmas that must be navigated. The road to a green future is not a straight line; there are trade-offs, gaps, and unintended consequences that China is grappling with as it pursues rapid, innovation-driven growth.

 

The first challenge is aligning the pace of decarbonization with economic and energy security needs. Despite massive renewable expansion, China remains heavily reliant on coal in the short term to keep the lights on and industry running. The fundamental tension is clear: China must balance short-term energy reliability and growth (which fossil fuels have traditionally guaranteed) with the long-term imperative of phasing out those same fuels. Managing this balance is as much a political and social challenge as a technical one, since it involves vested interests in coal-mining regions and state-owned power companies. The coming years (2025–2030) will be critical—China has pledged to start reducing coal consumption during the 2026–2030 period and to strictly limit coal power growth. Meeting these pledges will require careful choreography: accelerating grid upgrades, deploying energy storage at scale, and possibly accepting a higher share of gas or imports in the interim, all while maintaining economic stability.

 

Another challenge lies in technology gaps and dependencies. Despite its advances, China still relies on certain foreign inputs for high-tech climate solutions. For instance, sophisticated semiconductors and control systems are essential for EVs, smart grids, and AI—areas where U.S. and allied export restrictions have tightened in recent years. If China’s access to cutting-edge chips or software is curtailed, it could slow progress in fields like autonomous EVs or grid AI optimization. This is prompting China to invest heavily in self-reliance for critical tech components, but closing the gap will take time and significant capital.

 

A critical aspect of sustainability is social equity—ensuring the benefits of the climate tech revolution are widely shared and that vulnerable groups are not left behind or adversely affected. Within China, this means helping coal-dependent regions and workers transition to new livelihoods as fossil fuels are phased down. Provinces like Shanxi, Shaanxi, and Inner Mongolia have economies historically built on coal mining and heavy industry. The government has begun “just transition” initiatives, such as funding industrial parks in those regions to attract renewable equipment manufacturing or green hydrogen projects to create alternative jobs. Retraining programs for younger coal workers to enter solar installation or EV assembly jobs are also emerging.

 

Internationally, equitable collaboration will determine how positive China’s global climate tech influence is. Some recipients of Chinese investment have raised concerns about debt burdens or project quality—the so-called “debt trap” narrative around the BRI. Ensuring that clean energy projects are financially viable for host countries is crucial. Additionally, there is the issue of local capacity building: Chinese firms often bring their own labor and technology, but a truly sustainable approach would include training local engineers, employing local workforce, and transferring knowledge so that host countries can independently run and maintain the infrastructure. Progress on this front will make partnerships more balanced and enduring.

 

Looking ahead, there are significant opportunities for China to reinforce sustainability while advancing its climate tech leadership. Continued innovation is essential—especially in areas like energy storage, green hydrogen, and carbon capture. If China can commercialize next-generation batteries (for example, solid-state batteries or novel chemistries) or make green hydrogen cheap via electrolyzers manufactured at scale, it would solve key bottlenecks in decarbonizing transport and industry.

 

Second, improving policy and regulatory frameworks will ensure that technology deployment translates into genuine sustainability outcomes. It also means setting and enforcing high environmental standards for new industries (for instance, ensuring that battery factories or data centers are powered by renewables, and requiring recycling plans for solar panels and EV batteries). Aligning China’s domestic standards with international best practices could ease trade frictions too; for example, the EU is mulling carbon border tariffs and eco-design rules—if Chinese products meet those, they remain competitive. In the finance realm, China can refine its green finance taxonomy to clearly exclude high-emission activities, thereby channeling more private capital toward truly green projects. The People’s Bank of China has already launched a 200-billion-yuan re-lending facility for decarbonization projects, essentially providing low-interest funds to banks that lend to green ventures—scaling such programs will help close the funding gap for new climate technologies.

 

Third, global collaboration and governance will shape the broader environment in which China’s climate tech revolution unfolds. There is a tremendous opportunity for China to work with other major emitters and tech powers to amplify climate action. Despite geopolitical tensions, climate has remained a realm of dialogue. Additionally, China’s role in international climate negotiations remains pivotal: its ability to peak emissions early (potentially by 2025–2027, ahead of the 2030 deadline) would boost global confidence and encourage other emerging economies to raise their ambitions. If China leverages its tech revolution to flatten and then cut emissions earlier than promised, it could single-handedly bend the global emissions curve downward.

 

Seizing these opportunities will allow China not only to meet its own “dual carbon” goals but also to contribute decisively to global sustainability.

 

Cautious Optimism

China’s climate tech revolution is a story of stunning scale and speed—a transformation that is reshaping the country’s economy and energizing global climate action. In little more than a decade, China has evolved from a carbon-intensive outlier to a clean technology powerhouse driving the world’s renewable energy boom. It has done so through an unusual blend of top-down policy vision and bottom-up innovation, massive industrial mobilization, and cutting-edge digital ingenuity. We have seen how China’s triple transformation—toward sustainability, digital intelligence, and renewed global engagement—is unfolding.

 

As of mid-2025, there are signs of cautious optimism. China’s emissions growth has markedly slowed; some analyses suggest emissions may plateau within the next year or two, years ahead of the official target. Renewable energy is eating into coal’s share of generation, electric vehicles are becoming mainstream, and public consciousness in China about climate change and pollution is higher than ever. These trends give hope that China’s “green leap” is not just a short-term sprint but a sustained marathon toward carbon neutrality.

 

For the international community, China’s rise in clean tech has been both a wake-up call and an opportunity. It has spurred healthy competition—with Europe, the U.S., and others now racing to scale up their industries and innovate, lest they be left behind. This “race to the top” in climate tech could be a boon for the planet, as long as it remains focused on deployment and is not derailed by protectionism. Indeed, cooperation and knowledge exchange will be vital. There is much the world can learn from China’s experiences. By sharing lessons and aligning efforts, major powers can avoid working at cross purposes. Initiatives like joint standards for green products, collaborative research, and mutual opening of markets for clean tech can create a more efficient global response to climate change.

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