As fossil fuel prices rise and the pollution caused by them grows, the world looks to unlock a source of clean energy. One potential source is the ocean. The process to try and to harness the sea to make electricity consists of three principles: “underwater turbines that draw power from the ebb and flow of tides, surface-based floats that rely on wave motion and systems that exploit differences in water temperature”. Currently, the European Union has led the charge to capture electricity from the ocean.
Right now, China is emerging as an important testing site for capturing hydro-energy, which could heighten competition with Western companies. China could easily enter this competition by establishing joint-venture partnerships and use the technologies to expand this industry rapidly. What makes China a great spot to capture hydro-energy is because China has 11,000 miles of coastline with energy potential. Also, China has a major pollution problem that is continuing to get worse. So the combination of ideal location and the strong need for clean energy makes China a great spot to pioneer and to commercialize ocean-energy technologies.
Although this investment could potentially be very profitable, it is interesting to see that China continues to partake in massive investment projects. Over the past couple years, leaders in China have said that they plan on transforming their economy from an investment-driven economy to more of a consumption based economy. The reason for this move is that the explosion in lending from banks and ‘shadow banks’ has sustained Chinese growth. Economists believe that current scale of lending is unsustainable and could lead to a potential debt crisis. With around one billion yuan ($160 million) already invested into this project and construction of the turbines still a decade away, China will continue to its investment-driven growth. With this new project, I continue to doubt that China is making an effort to reshape its economy.