It’s long been known that Beijing is one of the most polluted cities in the world. A recent time-lapse video of smog rolling in over the city proved that point in no uncertain terms.
But now it looks like China is getting ready to tackle that issue head on. On January 5, Reuters reported that the nation is planning to invest 2.5 trillion Yuan–$361 billion—in renewable energy generation by the year 2020.
According to China’s National Energy Administration, that investment will create more than 13 million jobs in the clean energy sector. This will presumably take some of the pain out of potential job losses as the nation moves away from polluting, heavy industries.
The NEA says China plans to install wind, hydroelectric, solar, and nuclear power facilities and hopes that these sources will contribute to about 50 percent of the nation’s new electricity generation.
“The government may exceed these targets because there are more investment opportunities in the sector as costs go down,” Steven Han, a renewable analyst with securities firm Shenyin Wanguo, told Reuters.
The cost of building large-scale solar plants has dropped by about 40 percent since 2010, and China became the world’s top solar generator last year.
Although Beijing has been focusing on reducing pollution for some time, this may be the first concrete government spending on such a large scale dedicated specifically to renewable energy generation.
But the forecast isn’t all sunshine yet. Even after all this investment, renewables will still only account for 15 percent of overall energy consumption by 2020. More than half of China’s installed power capacity will still be fueled by coal.
Although a $361 billion investment is not all that big in the overall scheme of things, it sends a clear signal to markets that there is a future in clean energy. Once investors see that shift happening, funding for renewable energy generation will grow and make new and more ambitious initiatives possible.
Nonetheless, this investment should go at least some way toward addressing the ever-increasing social and economic cost of pollution in the world’s second largest economy.