China poised to earn vast profits from global energy transition: analysts
Chinese firms are in pole position to benefit from a wave of investment in clean energy infrastructure that could be worth trillions of US dollars
Chinese companies are primed to capitalise on a vast global wave of investment in clean energy infrastructure in the coming decades, as they are able to deploy solutions at a scale and cost that few can match, analysts said.
With China already rolling out green technologies – from wind and solar power to electric cars and batteries – at a massive scale domestically, its firms have the resources and know-how that other countries need to reduce their reliance on coal-fired power plants and gas-guzzling vehicles, they added.
“There’s going to be significant upside potential for Chinese companies that are well positioned to benefit from the billions – possibly trillions – of dollars that will be spent on new infrastructure development around the world in the decades ahead to mitigate against the effects of climate change,” said Eric Olander, editor-in-chief at The China-Global South Project.
“Chinese companies have the capacity to produce renewable energy products at a cost and scale that are unrivalled,” added Olander, whose organisation is a non-profit research firm.
The G20’s Global Infrastructure Hub estimated in 2017 that the world would need US$94 trillion of infrastructure investment by 2040 to support economic growth and close infrastructure gaps.
More than half the world’s electric vehicles and installed solar capacity is located in China, and Chinese firms are rapidly expanding their overseas sales. In August alone, China exported more than US$20 billion of clean energy technology, according to the think tank Ember.
However, China remains a major investor in fossil fuels. Last year, Chinese entities signed US$71.5 billion of oil and gas-related deals in belt and road countries, more than triple the level recorded in 2024, the report found.
Poorer countries wanting to scale up energy production quickly might still prefer cheaper traditional energy projects led by China, said Naubahar Sharif, head of the Education University of Hong Kong’s social sciences and policy studies department.
On Monday, a group of academics urged China to focus its belt and road investment on infrastructure related to climate change adaptation, as they warned that a rise in extreme heat and flooding risks could reduce the productivity of many traditional projects.
“The ‘small but beautiful’ strategy improves climate resilience by favoring modular, decentralised renewable energy projects,” said Christoph Nedopil Wang, director of the Green Finance and Development Centre.