China is winning the race for global clean energy dominance. Beijing has outspent every other country on Earth for years now, and controls critical global clean energy supply chains. Over the same time period, the United States has taken a major step back from clean energy objectives under the Trump administration, giving Beijing even more leverage. But while China’s ascension to global energy superpower status may seem like a foregone conclusion against this backdrop, the United States may have a unique opportunity to even the playing field thanks to two emerging technologies that still enjoy broad bipartisan support: enhanced geothermal and next-gen nuclear power.
Between 2019 and 2025, Beijing spent more than the rest of the world combined on clean energy. Compared to China’s more-than $500 billion in investments over that time period, the United States enjoyed a relatively scant $236 billion in clean energy investing, only 40 percent of which came from U.S. companies, “showing the US dependence on foreign direct investment for its manufacturing sector,” according to an Atlas Public Policy report published earlier this year.
The United States’ and Israel’s war in Iran has only granted more of an advantage to China. Extreme and ongoing volatility in global fossil fuel markets is catalyzing the global clean energy transition as countries rush to wean themselves off of oil and gas imports and build up their own solar and wind industries. This stands to grant a windfall to Chinese companies, which supply the most affordable and abundant clean energy components such as solar panels, wind turbines, and battery-powered energy storage systems.
But while China has established a lead in solar and wind power technologies that the United States has slim hopes of catching up with, the United States has carved out narrow leads in some alternative and cutting-edge clean energy sectors, most notably geothermal energy and some next-generation nuclear power technologies. The Trump administration has reversed Biden-era legislation supporting a wide array of clean energy supports, but it has doubled down on these two approaches as critical platforms of the United States’ strategy for energy security and independence against the backdrop of skyrocketing energy demand growth thanks to data center hyperscalers and the artificial intelligence boom.
‘Enhanced’ geothermal energy – that which uses advanced drilling technologies to tap into the heat of the Earth’s core from nearly anywhere on its surface – is increasingly capturing the attention of the public and private sectors alike, and has enjoyed vanishingly rare bipartisan support in the United States over the course of the last several administrations. Buoyed by sizable investments from the federal government as well as from Big Tech, the United States is fast becoming the distinguished frontrunner in the global geothermal energy sector. The United States Department of Energy projects that enhanced geothermal projects could provide about 90 gigawatts of carbon-free energy in the U.S. by 2050, or about enough to power at least 65 million homes.
Meanwhile, advanced nuclear technologies are enjoying a similar level of enthusiasm from the public and private sectors as the Trump administration earmarks significant resources from the U.S. Department of Energy’s Reactor Pilot Program to fast-track the testing and commercialization of advanced nuclear technologies like small modular reactors, molten salt reactors, and even nuclear fusion in order to bring them to scale. At the same time, Wall Street and Silicon Valley are throwing their weight behind advanced nuclear startups in an attempt to solve the growing AI energy crisis.
“China may lead in solar and wind power and in battery manufacturing, but the United States has the upper hand in two other essential technologies: enhanced geothermal and new nuclear energy,” Foreign Affairs recently reported in an article about ‘America’s Surprising Energy Advantage’. The piece goes on to say: “These may indeed be more valuable than solar and wind power because they draw from clean energy sources that do not depend on the weather. Washington, however, will have to coordinate with large technology firms and its many foreign partners if it wants to export its geothermal and nuclear capabilities to the wider world—or indeed power its own AI sector. Otherwise, Beijing will keep pulling ahead.”
By Haley Zaremba for Oilprice.com
