Joe Biden energy plan, Paris climate deal reentry would benefit China

Democratic presidential nominee Joseph R. Biden’s plans to rejoin the Paris accord and transition to 100% renewable energy are popular with climate advocates, but perhaps nobody stands to gain more from the Biden vision than China.

Not only does China lead the world in the manufacture of solar panels and wind turbines, the Chinese control an estimated 80% of the rare-earth minerals crucial to the production of lithium batteries, electric vehicles, and solar and wind equipment.

The 2015 Paris Agreement is also Beijing-friendly. While the U.S. pledged to reduce emissions by 26-28% by 2025, China only agreed to reach peak carbon dioxide emissions by 2030 and increase its non-fossil fuel energy sources to “around 20% by 2030,” according to the Climate Action Tracker.

“It should be called the Paris-China agreement because China is the largest beneficiary,” said James Taylor, president of the free-market Heartland Institute. “China is not bound to make any carbon dioxide emissions reductions, nor is it bound to cap its emissions.”

What particularly galls critics is that China is considered a developing nation by international standards despite having the world’s second-largest economy, meaning that Beijing is eligible for grants under the Green Climate Fund, which channels “climate finance” from the haves to the have nots.

The U.S. initially pledged $3 billion to the fund, launched in 2010, although President Barack Obama kicked in only $1 billion and President Trump has refused to contribute. The GCF’s goal is to mobilize $100 billion per year for “mitigation and adaptation in developing countries.”

Mr. Biden has promised if elected to reenter the Paris agreement even as Mr. Trump steams ahead with the U.S. exit strategy. He launched the departure process last year, meaning that the earliest withdrawal date is Nov. 4, the day after the presidential election.

While Mr. Trump has long railed against the U.N.-sponsored accord, saying it would put the nation at a competitive advantage and cost trillions, Mr. Biden has argued that the agreement is needed to combat climate change, which he calls “the existential crisis of our time.”

“While he [Mr. Trump] turns against our allies, I’ll bring us back into the Paris Agreement,” Mr. Biden said in a Sept. 14 speech in California. “I’ll put us back into the business of leading the world on climate change and I’ll challenge every other country to up the ante on climate commitments.”

At the same time, Mr. Biden has insisted that he will not ban hydraulic fracturing, the key to the U.S. shale boom and energy independence, although his $2 trillion plan to achieve net-zero greenhouse-gas emissions by 2050 would all but require a “transition from the oil industry,” as he said in last week’s debate.

The former vice president has argued that his plan would create “millions of jobs” by building green energy, which generated last year $57 billion in annual investment and supported 550,000 “high quality renewable energy jobs here in the U.S.,” said Gregory Wetstone, president and CEO of the American Council on Renewable Energy.

“American wins in a transition to renewable resources,” Mr. Wetstone said in an email. “With smart policies in place, we can continue to accelerate the renewable transition, driving America’s economic recovery and fulfilling the clean energy future that Americans want and scientists say we need.”

The shift to wind and solar also “frees us from the gyrations of global oil markets, which leave us vulnerable to foreign actors,” he said, although critics worry that Mr. Biden’s plan would leave the nation reliant on China and its renewable-energy dominance.

’Self-defeating restrictions’

The U.S. recently became energy independent for the first time since 1957, meaning that “we finally produce more energy than we consume,” said Dan Kish, senior vice president for policy at the American Energy Alliance.

The U.S. does still import about some crude, about 9.14 million barrels a day from 90 countries, mainly Canada, which accounted for 48% in 2019, according to the U.S. Energy Information Agency.

“What they’re talking about is exchanging [our former] dependence on the Middle East and OPEC, which was at one point close to 50% of our energy, for almost total dependence or twice as much dependency on China,” Mr. Kish said. “I’ve got friends who are geologists who are saying, why are we doing this? This is crazy.”

Government and business officials have long warned of the potential for a clash between U.S. clean-energy push — about 30 states now have renewable-portfolio mandates — and China’s grip on cobalt and lithium mining in places like the Democratic Republic of the Congo, Argentina and Chile.

Mr. Trump signed an executive order Sept. 30 declaring a national emergency on the “threat to the domestic supply chain from reliance on critical minerals from foreign adversaries,” accusing China of using “aggressive economic practices” to keep the upper hand.

He ordered the Interior Department to report back in 60 days with recommendations that “may include the imposition of tariffs or quotas, other import restrictions against China and other non-market foreign adversaries.”

China has periodically threatened to curb its rare-earth exports while seeking to increase its position in high-tech manufacturing.

“China could severely limit the rest of the world production of electric vehicles, hybrid vehicles, wind turbines, MRIs by reserving the use of Chinese domestically produced rare earths for the Chinese domestic manufacturing industries,” according to a report by Curtin University professor Dudley Kingsnorth, as reported July 27 by the Financial Times.

“Effectively, this would force the rest of the world to purchase rare earths embedded in the [original equipment manufacturers] made in China; destroying millions of jobs,” he said.

The industry has moved to address the imbalance. USA Rare Earth announced in December a pilot plant in Wheat Ridge, Colorado, described as “the first processing facility outside of China with the ability to separate the full range of rare earths.”

China is also the world’s biggest polluter, responsible for about 28% of global emissions. President Xi Jinping sought to polish his climate image last month by pledging that China would move up its 2030 emissions peak and reach “carbon neutrality” by 2060.

At the same time, China continues to approve coal-fired plants. In 2019, nearly 58% of China’s energy use came from coal, according to Carbon Brief, versus 23.5% of U.S. electricity generation.

“China’s economy is much more reliant on coal and hydropower than is the United States economy,” said Mr. Taylor. “In that regard, they’re being very smart. They’re utilizing the most efficient, affordable energy sources, and they’re benefiting from the Western democracies’ self-defeating restrictions on carbon dioxide emissions.”

He added: “So they sell us the equipment that puts us at a competitive economic disadvantage by dramatically raising our energy costs.”

Chris Horner, attorney for the public-interest law group Government Accountability & Oversight, posted a State Department document last week indicating that disputes between the Paris parties would be referred to a “conciliation commission,” which would then issue recommendations.

He said the document, obtained through an open-records request for the Energy Policy Advocates, raised concerns that the U.S. would be subject to challenges to its energy policies from its global adversaries.

“Now we are reminded that the U.S. can also expect a forum for antagonistic nations to bring their complaints about U.S. policy and claims of non-compliance with Paris’s required ’Net Zero’ agenda for resolution,” said Mr. Horner.

Even without the Paris accord, the U.S. leads the world in reducing greenhouse gases. In 2019, U.S. emissions fell by 2.9%, continuing a trend that began in 2005 as coal was increasingly replaced by natural gas made cheaper and more abundant by hydraulic fracturing.

“The one major country that has reduced its carbon emissions is the United States — and we are not part of the Paris Treaty,” said Stephen Moore, co-founder of the free-market Committee to Unleash Prosperity. “The Climate Accord is simply a shakedown of American taxpayers to pay for Europe and Asia.”

The Paris agreement has been ratified by 188 nations and the European Union, representing countries responsible for about 97% of greenhouse-gas emissions. The accord seeks to limit the global temperature increase to well below 2 degrees Celsius by 2100 from pre-industrial levels.