How can a clean tech partnership de-risk and decarbonise global supply chains?

Publishing date
23 October 2023
Heather Grabbe
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Trade in renewable energy goods is a global public good because all countries gain from the others cutting emissions, and all suffer from climate change if decarbonisation is delayed. Yet this vital process is too dependent on one producer, namely China, which controls most of the world’s production of solar panels, batteries for electric vehicles and to a lesser extent, wind turbines. These supply chains are vulnerable not only to potential weaponisation of one country’s dominance but also to unintended disruptions, such as pandemics or climate-induced natural disasters. Meanwhile, the demand for clean tech is growing fast, also in China itself, to meet its national targets for decarbonisation as the largest global emitter.

There are complexities involved in de-risking this supply chain. In addition to China’s dominance of the extraction and processing stages of production, Chinese firms are also far ahead of the rest of the world in green tech manufacturing and innovation.

The US and the EU are currently pursuing de-risking policies that aim to increase their own supplies of clean tech. However, a broader approach to improving the overall security of supply for all countries is needed. This could be done through the creation of a clean tech partnership composed of incentive compatible countries cooperating in the different areas of the supply chain of green tech, from extraction, refining, manufacturing and innovation.

Coordinated specialisation among members of this ‘green partnership’ will be necessary to achieve those objectives, while also leaving room for the private sector to compete. The aim of such a partnership is not to substitute for Chinese production, but to complement it through coordination with other interested parties. This can increase the production of green tech at a time when is most needed.

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About the authors

  • Heather Grabbe

    Heather Grabbe is a senior fellow at Bruegel, as well as visiting professor at University College London and KU Leuven. The focus of her research is the political economy of the European Green Deal and how the climate transition will change the EU’s international relationships and external policies.

    She is a political scientist who has served as director of the Open Society European Policy Institute in Brussels, and earlier as deputy director of the Centre for European Reform in London. She conducted academic research at the European University Institute, Chatham House, Oxford and Birmingham universities, as well as teaching at the London School of Economics. From 2004 to 2009 Heather was senior advisor to then European Commissioner Olli Rehn, responsible in his Cabinet for policy on the Balkans and Turkey. She has written extensively on the political economy of EU enlargement, the EU’s external and neighbourhood policies, and the evolution of new policy agendas in climate, digital and the rule of law. Her columns appear in the Financial Times, Politico and other quality media.

    Heather earned her PhD at Birmingham University, and her first degree in politics, philosophy and economics at Oxford University, where she also had a post-doctoral fellowship. She is fluent in English, French and Italian, with working level German.

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