China, by contrast, not only saw batteries as a technology, but as a strategic asset. Recognizing their role in everything from vehicles to renewable energy storage, the Chinese government poured billions of dollars into battery research and manufacturing. This not only included subsidies to battery factories, but also investments in processing the essential minerals of cobalt, nickel, and graphite — essential components of the modern battery cell. This vertical integration gave China a distinctive control over the battery supply chain.
China’s second landmark policy was in 2021, when it required that all new gigawatt-scale wind or solar power be paired with 10 to 30 percent battery storage. This continued to fuel demand for batteries and was rewarded with rapid scaling. China now produces 85 percent of all of the world’s battery cells and controls 94 percent of the lithium iron phosphate battery market. The implications for global energy security are profound. As countries attempt to decarbonize, most now must rely on a single-country-dominated battery supply chain.
One of the primary reasons China has ascended to the lead is its steadfast commitment to aligning technology, industry, and market demand. While the United States led in scientific innovation, it rarely followed through with the long-term industrial planning required to bring those innovations to market. Time and again, U.S. innovators created breakthrough technologies only to see them commercialized and scaled abroad.
Policy inconsistency plays a huge part in this disparity. As Greg Nemet, a professor of public affairs at the University of Wisconsin at Madison, puts it, China’s ability to maintain a stable policy environment allowed it to surpass the United States. Even when political winds changed, China continued to promote clean energy through subsidies, infrastructure investments, and regulatory reforms. In the United States, meanwhile, each new presidential administration brought with it radical changes in direction. As a result, the country has repeatedly undermined its own innovation by failing to offer a stable industrial policy environment.
In addition, the U.S. has been inclined to leave clean energy innovation to engineers and scientists, not recognizing the critical role of coherent industrial policy. Clean energy in China is not simply a technological goal but a national strategy. It is part of broader goals of energy independence, economic growth, and geopolitical influence. The outcomes are self-evident: electric vehicle adoption, battery production, and solar panel manufacturing have all reached gargantuan scale in China, with American firms unable to match the competition in markets that their technologies used to rule.
The geopolitical consequences of this shift extend beyond economics. As the globe decarbonizes to combat climate change, global dependence on Chinese technology may lead to new geopolitical vulnerabilities. Countries relying on Chinese batteries, electric vehicles, and solar panels may see their energy and industrial policies constrained. The U.S., on the other hand, has to answer a fundamental question: Will it remain a nation of inventors who watch their creations flourish abroad, or will it rise to its former role as a world leader in clean energy?
~~To catch up, the United States must embrace a new type of industrial policy — one that goes beyond research grants and pilot demonstrations to include comprehensive support to manufacturing, supply chains, and market development. This will require long-term commitment, bipartisan commitment, and a willingness to coordinate government action with private sector goals. It will also demand a cultural shift: from viewing clean energy as a niche or ideological issue to as a fundamental driver of economic competitiveness and national security.~~
This aint gonna happen.