"It's just clear, to say it directly, that China has too much of a chokehold on critical minerals, on critical processing and upstream technologies, and solar," White House energy adviser John Podesta told the conference. "We let that go. That was a mistake. We need to get it back."
He and other officials at the conference cited Europe's historic reliance on Russian fuel as an example of risks of relying on global rivals. State Department energy envoy Amos Hochstein and Under Secretary Jose Fernandez were among officials giving speeches or participating in panel discussions.
Since Russia invaded Ukraine Feb. 24, 2022, Moscow has cut natural gas supplies to Europe. Soaring energy costs forced Europe's industry and consumers to cut consumption, while governments and utilities scrambled to find alternative supplies.
Europe will remain vulnerable for years to spikes in global gas prices caused by even small gas supply outages, executives and officials at the conference said.
As the world moves toward a low-carbon economy, Podesta told attendees, "We need to make sure the supply chains are secure, that we don't have a repeat of what we saw with the Russian chokehold on fossil fuels."
Hochstein said the United States needs to "learn the lessons from the previous era, the 20th century fossil industry, and make sure we have as much production at home and make sure that the supply chains are secure." The Biden administration has encouraged domestic clean energy manufacturing investment. The Inflation Reduction Act, passed last year, provides hundreds of billions of dollars in incentives to companies opening new projects on American soil.
Despite U.S. comments encouraging a decoupling in trade with China, the two countries in recent months have made more energy supply deals related to
natural gas .
EXECUTIVES WARY
Energy executives agreed on the value of a diverse and secure supply chain. But some said the clean energy transition would be smoother if Washington could keep trade flowing and relations friendly with China, where products are often cheaper.
"I’m real worried about the U.S. not finding a way to talk to China. I think it’s very important for the future of the world and reducing CO2 that, on an issue as critical as climate, we need to be able to – at least – talk together," said Andy Marsh, CEO of hydrogen fuel cell company Plug Power .
"On the other side, I think nations need to think about
their own energy independence, and it’s really important for us
liberal democracies to make sure we have integrated, diversified
supply chains," he said.
In the mining industry, tensions with China could dampen investment in long-term projects, including in China itself, said Richard Adkerson, CEO of miner Freeport-McMoRan . "The situation with China is very complicated and clearly if the situation ... resulted in a major trade war between the U.S. and China, it would have an impact on the world's economy broadly," he said.
That risk "is overhanging our industry right now. It's another factor that makes companies reluctant to initiate investments in long-term projects to meet the coming demand for copper," he said. Copper, used in everything from electric vehicles to the power lines and transmission grids, is essential to an increasingly electrified society.
The United States could not possibly become completely independent from China-made components such as electrolyzers for hydrogen production, batteries and solar panels, said Takajiro Ishikawa, CEO of Mitsubishi Heavy Industries Americas.
"There has to be a lot more cooperation between nations," he said. "For America to win its challenge against climate change, you cannot build everything in Japan or America."
The world's two top economies need to combine their industrial and political power to build the energy industry of the future, some participants said.
"China and U.S. have to engage on this," said Mark Hutchinson, CEO of Fortescue Future Industries.
"Trade conquers all at the end of the day."
(Reporting by Ernest Scheyder, Sabrina Valle, Liz Hampton,
David French, Stephanie Kelly, Simon Webb, and Richard
Valdmanis; Editing by David Gregorio)
