Net zero reliance on China tested
THE Government is to war-game the impact of a Chinese shock to supplies of batteries and solar panels as it examines how dependent Britain’s net zero plans are on Beijing.
The Department for Energy Security and Net Zero has commissioned the think tank Rusi to investigate whether over-reliance on China amounts to a security risk and to look at the impact of a disruption to supplies.
Tender documents say the study could inform future efforts to secure supplies of critical minerals and other vital products from outside of China.
Pressure on Western governments to decarbonise their economies has clashed with concerns about China, since a vast quantity of batteries, solar panels and other materials come from the country. The study will also examine Britain’s reliance on China for wind turbines and nuclear equipment.
A Government contract asks the report’s author to assess how dependent Britain will be on China’s clean energy supply chains in scenarios where the UK is more, the same and less reliant on the country than it is today.
The work will identify the largest risks to the UK, as well as “the potential impact of any future disruption to the UK’S imports of clean energy goods from China”.
It suggests that the research could lead to moves to seek supplies from elsewhere, saying: “These risks have encouraged some of the UK’S partners, such as the US and EU, to look to reduce dependence on China for clean energy supply chains (for example the US Inflation Reduction Act and the EU’S Critical Raw Materials Act). Without clear understanding of the shape of future supply chains it is impossible to ascertain the potential implications of the UK’S exposure to the clean energy supply chain concentration.
“It is therefore important to develop understanding of the UK’S future reliance on China in clean energy supply chains to inform work on de-risking supply chains.”
Rusi examined China’s dominance of energy supply chains last year, finding that the country had a near-monopoly in areas such as rare earth elements used in wind turbines, electric vehicles and components used in solar panels.
A Government spokesman said: “This research will bolster our energy security by ensuring we identify future risks and opportunities in supply chains at the earliest possible stage.”