HOBBLING U.S. INNOVATIONWhy the U.S. Is Letting China Win on Energy Innovation
The frontiers of global technology have pivoted to AI and next generation energy. In AI, the U.S. has far outpaced any other nation, but in energy, the U.S. has just tied its shoelaces together. The reason isn’t technology, economics or, despite the administration’s misleading official line, even national security. Rather, it is politics. The fact is, the U.S. does not have an energy security problem. It does, however, have an energy cost problem combined with a growing climate change crisis. These issues will only be made worse by Trump’s enthusiasm for fossil fuels.
During the cold war, the US and Soviet Union were locked in a desperate race to develop cutting‑edge technologies like long-range missiles and satellites. Fast forward to today and the frontiers of global technology have pivoted to AI and next‑generation energy.
In one domain, AI, the US has far outpaced any other nation – though China looks to be closing the gap. In the other, energy, it has just tied its shoelaces together. The reason isn’t technology, economics or, despite the government’s official line, even national security. Rather, it is politics.
Since returning to the White House in January, Donald Trump has handed out huge wins to the coal and oil and gas industries. This is no great surprise. Trump has long been supportive of the US fossil fuel industry and, since his reelection, has appointed several former industry lobbyists to top political positions.
According to the Trump administration, national security requires gutting support for renewable energy while performing political CPR on the dying coal industry.
The reality is that, since 2019, the US has produced more oil, gas and coal annually than Americans want to use, with the rest exported and sold overseas. It is currently one of the most prolific exporters of fossil fuels in the world.
In short, the US does not have an energy security problem. It does, however, have an energy cost problem combined with a growing climate change crisis. These issues will only be made worse by Trump’s enthusiasm for fossil fuels.
Over the past six months, the Trump administration has upended half a decade of green industrial policy. It has clawed back billions of US dollars in tax credits and grants that were supercharging American energy innovation.
Meanwhile, China has roared forward. Beijing has doubled down on wind, solar and next‑generation batteries, installing more wind and solar power in 2024 than the rest of the world combined. To China’s delight, the US has simply stopped competing to be the world’s clean energy powerhouse.
Roughly one-in-five lithium‑ion batteries, a key component in clean energy products, are made in China. Many of the newest high‑tech batteries are also being developed and patented there. While Trump repeats the tired mantra of “drill, baby, drill”, China is building factories, cornering the market for critical minerals such as lithium and nickel, and locking in export partners.
