The UK’s potential vulnerability to its dependence on China for clean tech manufacturing is to be examined in a new government study.
The Department for Energy Security and Net Zero (DESNZ) has awarded a contract to defence and security think-tank Royal United Services Institute (RUSI) to carry out the research.
RUSI will examine the UK’s dependency up until 2050 on China for four key net zero technologies: solar panels, wind turbines, batteries (for energy storage and electric vehicles) and nuclear.
Ramping up deployment of clean energy technologies is vital for meeting net zero, says the contract, which was published last week, but “clean energy supply chains are more complex and concentrated than fossil fuels.”
“The resilience of these supply chains will become increasingly vital for the UK’s future energy and economic security,” it said.
The DESNZ contract notes research from the International Energy Agency (IEA) highlighting the dominance of China in the processing of critical minerals and in the manufacturing of clean energy technologies.
Country’s concerns around energy security have been heightened since Russia’s invasion of Ukraine sparked a global energy crisis – with European countries in particular suffering badly as they pulled themselves off dependence on Russian gas.
Dependence on China is viewed with suspicion given its difficult relationship with the West.
“We know that – given the level of China’s global control of these technologies and their supply chains – the high levels of supply concentration creates risks,” it said.
Those risks include “external shocks, resource nationalism, export restrictions, mineral cartels, political instability and market manipulation.”
The contract notes that the US Inflation Reduction Act “explicitly targeted reducing the concentration of these supply chains in China, particularly around critical minerals, and other partners are considering similar measures.”
It also wants to weigh the risks up against potential advantages of relying on Chinese supply, noting that research indicates that China is not abusing its dominant position and economies of scale are allowing for a reduction in the cost of clean tech.
A government spokesperson told Recharge: “This research will bolster our energy security by ensuring we identify future risks and opportunities in supply chains at the earliest possible stage and forms part of our strategy to back UK businesses, build resilient supply chains and avoid overdependencies in the market.”
