As the global energy crisis triggered by the Iran war has driven a surge in demand for clean energy, China, which dominates this market, is reaping big profits.
On the 6th (local time), the Washington Post (WP) reported, "China produces most of the world's solar panels, wind turbines, batteries and electric vehicles and controls the clean energy supply chain," adding, "Sales of related products are expected to increase further due to the volatility of fossil fuel supplies."
In Asia, where dependence on Middle Eastern energy is high, demand for clean energy has recently been surging. On the 6th, Indonesia President Prabowo Subianto said the country would build 100 gigawatts of solar power capacity within the next two years, and the Philippines' state pension fund GSIS began offering loans of up to $8,300 (about 13 million won) for the purchase and installation of home solar systems.
Europe, whose dependence on the Middle East is relatively low, is also moving to expand the share of clean energy. Germany released an 8 billion-euro (about 14 trillion won) package to expand wind power capacity and provide electric vehicle subsidies, a representative example.
This trend contrasts with recent years, when clean energy industries such as solar, batteries and electric vehicles suffered from overproduction and falling prices due to massive subsidies and price competition among countries. In 2024, solar manufacturers recorded losses of about $4 billion, and major Chinese solar corporations cut more than 30% of their workforce.
Yang Biqing, a China analyst at London-based energy think tank Ember, said, "The increase in demand for clean energy is not a short-term reaction to rising oil and gas prices but part of a long-term trend," adding, "Energy security is emerging as a core agenda for governments, and the clean energy transition is seen as a way to strengthen it."
With expectations that China will absorb a significant portion of the increase in clean energy demand, related corporations' stock prices are also rising. According to WP, after U.S. and Israeli strikes on Iran, the Hong Kong-listed shares of Chinese battery corporation CATL rose 29.5%, and its Shenzhen-listed shares gained 13.6%. BYD said its overseas sales in March rose 65% from a year earlier, and solar corporation JinkoSolar also said exports increased after the war.
Lin Boqiang, director of the China Center for Energy Economics Research at Xiamen University, said, "Chinese corporations control the key product markets needed for clean energy production and also have expense and quality competitiveness," assessing that the latest increase in demand will be an opportunity for China. The Council on Foreign Relations also noted, "Energy technology not only mitigates these climate-related risks but also increases a country's resilience to price volatility of conventional fuels such as oil and gas caused by external crises like the Iran war," analyzing that China is in the best position to benefit from rising demand for clean energy.
In fact, some Asian countries suffered relatively little damage amid geopolitical tensions thanks to their reliance on Chinese clean energy. According to Bloomberg News, countries such as Pakistan and Nepal have actively adopted Chinese solar power and electric vehicles since the Russia-Ukraine war, avoiding major damage despite the recent surge in oil prices.
However, there is a possibility that cooperation with China will be limited over national security concerns, especially among Western countries. The United Kingdom blocked a plan by Chinese wind corporation Mingyang to build a factory in Scotland on national security grounds. Li Shuo, head of the China Climate Hub at the Asia Society Policy Institute in Washington, said, "In the future of the energy system, geopolitics is as important as economic choices," adding, "How much each country reduces dependence through decoupling from China affects its decarbonization capacity."