The Age of the Unambitious
Slow-walking the transition
The planet orbited the earth for billions of years before humans arrived, but people make our world go round. We’re a social species that loves to try to figure out what’s going on with others: other societies, other communities, other people. Perhaps the greatest temple to the the deep dive into another life is the New Yorker profile. There are too many great ones to count or, if I’m being honest, to even start going through the archive because I’ll never finish this post. As a China guy, I really came to appreciate the profiles of Evan Osnos, who brought to life relatable people from a place often written about in threatening fashion. Perhaps my favorite of these is his writing on the economist Justin Yifu Lin.
When lecturing about the puzzle of China’s economy, Lin is a great character. He trained in the West — Chicago even! — but worked in (and for) Beijing. Lin was the first person from a developing country to serve as the World Bank’s chief economist. In 2012, he published an English version of his Demystifying the Chinese Economy, which argued that China could expect 8% growth until 2030. His optimism could not be contained; Osnos’s profile is called “Boom Doctor” for a reason. That year as Lin was leaving the Bank to return to Peking University (Beida), the Bank put out a major report that was far less optimistic. The fact that the World Bank’s chief economist, on the topic that made his career, disagreed with a report that the Bank in concert with the Chinese State Council’s Development Research Center by being more optimistic than literally the government of China, speaks to the complicated nature of predictions and assessments about China’s economy moving forward.
Justin Lin -- or Lin Yifu -- was originally born not on the mainland but in Taiwan, where he served as a soldier. How did a Taiwanese soldier become a Beida professor? He defected. You read that correctly.
Here’s Osnos:
On the night of May 16, 1979, Lin walked to the water’s edge, stepped out of his shoes, and waded into the Taiwan Strait. The current was swift and strong, but he had been studying the sea, and he timed his departure to avoid being pushed back to shore by the rising tide. “You need to go when it’s receding,” he recalled. “You need to cross the middle, and then the rising tide will carry you all the way over to the other side.” …
Lin left behind Chen, who was pregnant, and their three-year-old son. It’s not clear how much Chen knew of the plan. (Wu Ho-Mou, a friend and an economist at Peking University who has discussed the matter with Lin, says, “He said goodbye to his wife only in his mind.”)
Osnos ends his writing on Lin with the following reflection:
But part of him would remain unknowable to me. I had been drawn to him years earlier by the audacity of his decision to defect. I had imagined it to be the act of an idealist. But, over the years, I had come to see a practical side to his choice as well. He was a man who believed, above all, in his own power to achieve his ambitions, and he would do whatever it took to do so. And that, I realized, was fitting. It was the energy of China’s boom distilled to its hardest truth: a solitary man who decided that he could realize his future only by going to the People’s Republic.
Osnos’s original profile came out in 2010, when China’s economy was turbocharged by Keynesian stimulus following the global financial crisis. His book, Age of Ambition, weaves together a number of his profiles was published four years later and deservedly won the national book award for nonfiction.
Why dwell on Lin and Osnos’s book a decade later? Because ambition — its presence but also its absence — remains core to my understanding of China today.
One Word: Unambitious
I was happy to participate at an event last week at the Carnegie Endowment for International Peace. The event launched their Climate Clarity report, an important document pushing back on the new climate denialism, which can be seen in various statements by the Secretary of Energy and the President. Some, like CFR’s climate realism initiative, try to put a bit of lipstick on this pig, but I’ve already laid out my critiques of those ideas. Noah Gordon of Carnegie opened the conversation with a lightning round to ask the panel to give one word to summarize our impressions from the just-concluded NYC Climate Week. I gave “unambitious,” which was not a diss at my friends who hosted a range of exciting panels and parties but aimed at one person who only showed up on video: Xi Jinping, and in particular his announcement of China’s updated climate commitments as part of the Paris agreement (it’s nationally determined contribution or NDC because climate people are defenseless in the face of a good acronym).
Here’s what I said: Xi tried to replicate the positive acclaim that he received five years ago when he pledged that the country would be carbon neutral by 2060. And while the update is nothing like the denialism coming out of the Trump administration, it is a wholly unambitious set of targets that suggest the country has yet to decide if it is interested in winding down its dependence on coal, let alone has settled on how it will do so.
During climate week, I took a quick jaunt to New York and met with Heatmap’s Rob Meyer. I was ranting about the NDC along these lines when he paused, “are you pitching me right now?” Readers, that was not the intention, but that’s how what began as a rant became “China Is Deciding Not to Decide on a New Green Future.” Here’s perhaps my favorite part:
But China’s dithering is more than just an environmental failure — it is a governing mistake. China’s weak climate pledge isn’t just bad news for the world; it shows an indecisive leadership that is undermining its country’s own competitiveness by sticking with dirty coal rather than transitioning rapidly to a cleaner future.
The new pledge — known in UN jargon as a national determined contribution, or NDC — reveals a disconnect between the government’s official position and the optimistic discourse that now surrounds China’s clean energy sector. China today is described as the world’s first electrostate; we are told that it stands at the vanguard of the solar and EV revolution, ready to remake the world order against a coalition of petrostate dinosaurs.
The NDC makes it obvious that the Chinese government does not yet view itself in such a fashion. China might look like an adult, but it more closely resembles a gangly teenager who is still getting used to their body after a growth spurt. As the analyst Kingsmill Bond recently put it on Heatmap’s podcast Shift Key, Chinese clean tech manufacturers have unlocked a cleaner and cheaper path to economic development. It isn’t yet clear that China is brave enough to commit to it. If China is the adult in the room, in other words, we’re screwed.
Oh and this one too.
What is literally happening in these meetings? The government is bringing private actors into the same room to bang their heads together and deal with the reality that the current economic system is not working, largely because of intense competition — which is likely best solved by forcing some of the firms and production capacity to shrink. Firms are unprofitable because exuberant supply has zoomed past current demand, and the country’s markets and politics are unprepared to navigate neither the potentially needed bankruptcies nor their attendant fallout. So the government is intervening, designing actions to generate the outcomes it desires.
Yet there is something contradictory about the government’s approach. A decarbonized world, after all, will be a world without significant numbers of internal combustion vehicles, and traditional automakers will eventually need to shut down or shift into EVs — yet their executives aren’t being dragged in for the same scolding. Likewise, a decarbonized world will be a world without as many coal mines and coal-fired power plants. Firms in the power sector should be scolded for continuing coal production at scale.
We are in the mid-transition, as the scholars Emily Grubert and Sara Hastings-Simon have put it. But China is further along in this transition than other states, and so it could lead in the management and planning required for the transition as well.
And this perhaps is another space where ambition rears its head. There’s a lot of debate about involution these days. I’ll have more to say about it in future posts and pieces as well, but here I want to make clear that in China’s clean tech sectors we are seeing capitalist competition of such intensity that profits are going to zero while social benefits are large. Which doesn’t sound like that bad of a thing. Now, it’s more complicated than that, but firms and their leaders are ambitious. They want to wage and win these fights. Competition isn’t imposed on them by colonialism or American hegemony or anything else. They saw an opportunity and jumped for it, and now find themselves in a heavyweight bout. If cheap solar plus batteries allows for decarbonized global growth, the companies that make those products will be lauded and remembered. Seems like the kind of ambition we should reward.
The Messy Bits
Welcome to the sausage making. As ever, my lovely editors cleaned up the prose, snipping and trimming to make the arguments as sharp as possible and fit for purpose for the Heatmap audience. But for those of you here, I’m happy to share some of the messy bits that didn’t make it through the editing process.
My initial rant became some notes the day after Xi gave the NDC update. Then that was expanded and a full draft ready sometime last week. Then editing. In the interim, the International Energy Agency’s Renewables 2025 report came out. I had some thoughts that could have been folded in, but they complicated the flow of what was an already meaty piece. So, here are some thoughts about another great document full of valuable data and insights, including forecasts of renewables additions through 2030.
The report leaves me with a mix of optimism and pessimism. It ratchets down both US and China’s renewable buildout from the 2024 report. US down more than 40% (!) and China down about 5%.
But even with this slightly reduced estimate for China, the IEA’s main case is WAY ahead of China’s NDC. Its main case estimate has about 2100 GW of renewables added from 2026-2030. That would basically hit the 2035 target of 3600 GW that Xi outlined last week, by 2030 instead of 2035. The IEA forecasts roughly 400 GW of annual additions, whereas the NDC points towards around 200. I hope they are right, but that level of additions with slow economic growth would eviscerate coal. Again, I hope they are right! But as I say in the piece and above, the unambitious nature of the NDC does not give me a ton of confidence that they are prepared to tackle dismantling the coal sector in the next five years.
Ok, I promised messy bits. How about some methodological debates in linkedin comments? Michael Davidson, who Heatmap had on Shift Key to talk about the NDC, is a great scholar of China’s electricity grid. He shared a paper that he and co-authors had written about how to think about the NDC in the months leading up to the announcement. The study modeled Chinese grid decarbonization at approximately the 3600 GW level that comes out of the NDC, however, the model is pursuing a least cost solution for the grid, and sees an imbalance in favor of solar over wind compared with what might be a bit closer to optimal given assumptions of something close to a 50/50 mix of solar and wind. He briefly mentions this in the podcast episode — that there’s a need to add more of the higher capacity factor wind compared with just dumping ever more solar panels onto the grid.
But solar has been growing far faster than wind in China, and already has a much broader installation base. The IEA study forecasts 1 TW (that is 1000 GW) of wind capacity installed by 2030 in China, but more than 3 TW of solar by that date. It’s worth emphasizing this point because many of the big reports about net zero expect something similar. Wind and solar balance each other as wind tends to be more powerful in the evening and winter, complementing solar’s daytime/summer strength. Overall, a solar heavy mix that the market is providing isn’t the way that modelers traditionally envisioned the topology of a least cost electricity system.
And in the comments of that linkedin post, Lauri Myllyvarta of CREA comes in with specific questions about specifics of both the shift in technologies from solar to wind but also the rise in capacity factors that the modelling results rely on to help decarbonize the grid. Specifically, the Chinese Electricity Council (CEC) releases utilization data on how many hours the average solar panel/wind turbine generates electricity. China’s capacity factor estimates (14% for solar and 24% for wind for 2024) are very low compared to the US (23% and 34%, respectively). There are questions about CEC’s methodology — e.g., a solar farm that gets installed in March but only really connected in June might be zeroed out for months, which would drag the numbers down — and inefficiencies of Chinese grid connections and so on, but these details end up making a difference, especially when you’re talking about shifting 3 TW of generating capacity from 14% to 18%!
Curtailment data are also vastly underestimated, which should be good news meaning that there’s more power to grab and store and utilize, but also means that understanding what’s really going on is even harder. Chinese data quality is always a thing.
Where does this leave us? I think there’s no read of the NDC that isn’t deflating for those of us who think we’ve glimpsed the future of a cheaper, cleaner, better planet. I ended the essay reflecting a bit on my trip to Ordos, where the coal and clean energy systems are right next to each other. Coal employs tens of thousands of people, powers the economy today, and new industries like the disastrous coal-to-liquids sector are growing out of the dirty black rocks. But as I saw the trucks hauling rocks on highways around and outside of town, it felt so primitive compared to the shiny new clean energy facilities that were around — where we can simply move electrons around. The efficiencies are obvious, as are the benefits — on climate and otherwise. Yet, it looks as though Xi and the Chinese government aren’t so convinced.
Some people are more cautious, others love jumping ahead and making a splash. Perhaps its fitting that Justin Lin has a 2nd edition of Demystifying the Chinese Economy coming out this November. Despite a decade of slower growth, the boom doctor is still in.