The Daily Signal - Dirty Facts About China’s ‘Clean Energy’ with Diana Furchtgott-Roth

Episode Date: August 30, 2024

China's production of batteries for electric vehicles is “definitely not clean,” says energy expert Diana Furchtgott-Roth. Without its own vast natural energy resources, China is the world’s largest energy importer, but has seized on the economic opportunities of the “green energy” movement. Yet the production of products such as EVs is causing harm to the environment, says Furchtgott-Roth, director of The Heritage Foundation’s Center for Energy, Climate, and Environment. China produces about 80% of the world’s EV batteries and “mining for the critical minerals in the batteries … causes vast amounts of environmental damage,” she explains. Production of one EV battery involves moving “hundreds of thousands of pounds of earth to get the critical minerals for one battery,” Furchtgott-Roth notes, adding that “China is buying mines in Africa so that it can get the critical minerals, [as well as] mines in Latin America.” Furchtgott-Roth is the co-author of “How the Forced Energy Transition and Reliance on China Will Harm America,” a new Heritage Foundation report exposing the ways in which the “green energy” movement is harming America while benefiting China. She joins "The Daily Signal Podcast" to explain it all. Learn more about your ad choices. Visit megaphone.fm/adchoices

It's definitely not clean energy, unless it were part only with wind and solar or nuclear power. But right now, mining for the critical minerals in the batteries causes vast amounts of environmental damage. Welcome to the Daily Signal podcast for Friday, August 30th. I'm Virginia Allen. And that was Heritage Foundation Director of the Center for Energy, Climate and Environment, Diana Furch got Roth. The U.S. is bolstering. Chinese economy. How? Well, EV batteries and solar panels are the answer. Because China is the largest producer of solar and EVs, the clean energy agenda is directly benefiting China, even though,

according to Diana, that production of the so-called clean energy materials is neither clean nor environmentally friendly. Diana and Miles Pollard are the authors of a new report how the forced energy transition and reliance on China will harm America. And she joins us on the show today to explain exactly how this forced energy transition from natural energy resources to things like solar are in fact and will continue to harm America if there is not a course correction. But before we get to my conversation with Diana, I want to tell you all about another Daily Signal podcast.

If you love the Daily Signal podcast here and specifically, if you're a woman, you might really enjoy joining us on Wednesdays or Thursdays for problematic women. We have just relaunched the show with video. So now not only can you get the Problematic Women podcast wherever you listen to podcasts on Thursday morning, but you can join us exclusively live on Wednesday afternoons when you visit the Daily Signals YouTube or Rumble account. Problematic women really leans into the fact. that as conservative women, we are inherently problematic. We don't fit the far left definition of what a feminist is.

We stand for traditional values. We know that all life is sacred and worth protecting from the womb to the tomb. And we believe that women's sports should remain women's only sports. And we love diving into the topics every single week that are of particular interest to conservative or problematic women. So now, join us live every Wednesday and come sit with us, grab a cup of tea, and let's talk politics together from a conservative perspective. Or listen on the go every Thursday morning wherever you get your podcasts. Well, I am so pleased to welcome back to the Daily Signal podcast, Heritage Foundation, Director of the Center for Energy, Climate and Environment. Diana, Furch got Roth.

Thank you so much for being back with us today, Diana, to talk about this. Oh, it's great to be with you. It's always great to be on the podcast, Virginia. You are just doing such great work at the Heritage Foundation in regards to looking at what is happening in this fight over energy related to China and the United States, and what is the threat that China poses specifically to the U.S. So you've just come out with a brand new report in a series of reports talking about this. The latest is called forced energy transition in China's role in the conversation about energy.

we're diving in to really dig at what is happening here related to China in this energy conversation. And I think it's interesting because, you know, when we talk about the struggle over power, we automatically talk about military power, we talk about economic power. We don't always talk about energy power. So if you would, sort of set the stage in this struggle between nations over power, how big of a role does energy play? Well, first of all, energy does not have to play a great role, but it is because there are people in the United States. States who only want Americans to use renewable energy, only want them to use EVs, and you hear about the transition to net zero. Well, really, there is not going to be any transition to net zero if we

keep our current lifestyles. And what this does is, it makes the United States dependent on countries that produce the wind turbines, the solar panels, the electric vehicles. And right now, all of these are coming out of China. China has a comparative advantage because it subsidizes labor and uses forced labor in Xinjiang. It subsidizes our energy. It doesn't have our regulations, and it builds a couple of coal-fired power plants per week. And it subsidizes capital by giving low-interest loans to its favored firms. So the point of this project, which is called China,

handcuffs after the children's toy where if you put your fingers in a little tube and pull as hard as you can, the harder you pull, the more difficult it is to get out your fingers. The point of the Chinese handcuffs project is to show that we are doing this ourselves. America is making the regulations that require the use of Chinese goods. Chinese wind turbine, solar panels, and components for electrical vehicles. For example, China makes 80% of the world's batteries right now. So energy does not have to be such a flashpoint for the United States, because we could just say, well, we're going to use our own supplies of oil and natural gas.

And then we would have a comparative advantage. We're going to use our great auto workers in Detroit. and Toledo and make those jeeps that are so iconic, and by the way, I drive one of them, made in Toledo. But now, for various reasons that I can explain later, also a lot of these jobs are going over to China. So it doesn't have to be, but it is. And if you look at what happened, what started the big energy crisis in Europe, was when Russia ended the natural gas exports to U.S.

Europe because of the war with Ukraine. So Russia is using energy as a weapon. OPEC was using energy as a weapon in the 1970s. America's insulated from that right now because we are the largest producer of oil and natural gas in the world. We're now a net exporter. Yeah, which is, I think you so clearly articulate how things have shifted so much in the last several years in this report, how the forest energy transition and reliance on China will harm America. Folks can find that at the Heritage Foundation website. But it's fascinating that America as the largest, one of the largest exporters of energy and China, one of the largest importers, it's almost like tables are being turned now with this green energy push. It really,

is Virginia, and it's very unfortunate because, as I said, we are the largest producer in the world, and the North American platform is so efficient. You know, we get heavy crude from Canada, we refine this into gasoline and heating oil. Our production of natural gas, not only is through the roof, but it's really rock-bottom prices right now. It's about $2.19 per million BTOs in the United States. In Japan, it's about six. times that amount. So it's not only that we can use it here, but our allies would like to use it over there. Japan would like to buy more of our LNG. Taiwan would like to buy because more liquid natural gas means cleaner air because it displaces a lot of coal use. So then when here in the

United States there are these green energy mandates, whether at a state level or a federal level, How does that affect the U.S.? And how does that affect China? Well, it affects the United States in that our electricity prices go up because it's more expensive producing intermittent energy than continuous energy. So say you have your natural gas pipeline,

powered by clean natural gas from the United States, and you have that run continuously. The price for that is much lower than if you have to integrate wind, which doesn't blow all the time, and solar, which doesn't, where the sun doesn't shine all the time. And you have to integrate that into your electricity pricing, because when the wind doesn't blow, then you have a smaller natural gas plant kicking on. And then for the solar panels, you have maybe large amounts of battery storage. Then you take all those different goods,

your backup natural gas, your solar, your wind, you somehow get it through all these transmission lines and you send it to Virginia Allen in her home. Well, it's more expensive to do that than if we just ran a natural gas power plant continuously and sent it to Virginia in her home. So Americans are paying higher prices for electricity made from renewable energy. And Americans are also paying higher prices for these electric vehicles. The best-selling car in the United States is the Ford F-150 pickup truck. And the lightning. the Ford Lightning, which is the electric equivalent, costs about $25,000 more. Wow.

So the mandate for EVs will require Americans to pay more for the cars that they drive. And the cars that they like to drive might be even more expensive. They might decide, well, you know, I cannot get an EV pickup truck. It's too expensive. So I'm going to downgrade to maybe a two- or four-door small car. Explain the production side, if you would. How is an EV battery produced? There's a label that's sort of been slapped on these things, like EV batteries,

that's clean energy. Is that right to label it as clean? No, it's definitely not clean energy, unless it were part only with wind and solar or nuclear power. But right now, mining for the critical minerals in the batteries, that causes vast amounts of environmental damage. And you have to move hundreds of thousands of pounds of earth to get the critical minerals for one battery.

We can see that China is buying mines in Africa so that it can get the critical minerals, mines in Latin America. So China has the advantage with all this major mining for the critical minerals that go into the back. batteries. Then the battery is made. It has to be shipped to the United States. Once the battery is in the vehicle, the vehicle weighs about one and a half times as much as a gasoline-powered vehicle, so it emits more what's called particulates. That's sort of like smog or soot on the road.

And by the way, the Environmental Protection Agency, which wants to require that 70% of the cars sold in 2032 or electric, also has a parallel rule to reduce these particulates. And it doesn't say, well, by the way, these electric vehicles are making more particulates. It just has these different rules. So they definitely don't like particulates, but EVs produce about 25% more than a gasoline pad car. And then, of course, the battery has to be disposed of, and that's a whole different operation. but these vehicles are only emissions free if you charge them with energy that does not make emissions.

And right now, no one is really doing that. Is it similar on the production side for solar panels? Is it a quite different process? So the solar panel process is, again, it's difficult to make a solar panel only with renewables. And with wind turbines, wind turbines are huge structures that have cement, they have steel, and you need a furnace at very high temperature, a coal-fired furnace, to make the material that goes into those wind turbines. So yes, when the wind turbines go around, maybe they don't have any emissions at that time,

but the whole process of integrating them is very sophisticated. Right now we can't do that just on it. renewables or nuclear loan. Okay. Dan, I was really fascinated that you write in the report that China is using stolen information to enhance their competitiveness. What do you mean by that? What has China stolen in this regard in order to enhance its competitiveness in regards

to production of EB batteries, solar panels, etc.? Well, first of all, I should say that this report is co-authed with my colleague Miles Pollard, and that is one of his lines. so I wish I could take credit for it, but I can. But what we're saying is that intellectual property is taken from other firms. Okay. And any company that locates in China often ends up turning over its intellectual property to the Chinese Communist Party as a requirement of doing business.

Because trade with China is not fair. If a Chinese company wanted to locate here in the United States, it could buy another company here, it could locate, it would not have to give its intellectual property to the American government. On the other hand, often an American company locating in China has to give up its intellectual property as part of the bargain for locating in China.

You might say, why would any company do this? Well, the answer is China is a huge market. There are over a billion people in China. It's every company's business. dream to be selling in China. And so they locate there and they end up with a deal that often requires intellectual property to be given to the Chinese Communist Party. Because the way it works in China is everyone's like a large family and the Chinese Communist Party has a stake in everything. It's like the daddy. And then all the children report to that Chinese Communist Party daddy and they

have the intellectual property and they tell it to the daddy. So there really aren't private corporations or companies in that regard. It's all government-run in a way. The major companies in China all have, there's a stake in the Chinese Communist Party of all companies, major companies there. So take B-YD. B-Y-D is right now the largest vehicle exporter in the world. It's a Chinese company. used to just make batteries, then they started putting cars on top of their batteries. BYD stands for Build Your Dreams, and it is exporting and undercutting a lot of other auto companies. So in Europe, they're selling a car called the Seagull for about $11,500. Even with a 100% tariff, that would be $23,000, less than almost any new car I can think of here in the United

States. So they're just using the subsidies, the intellectual property theft to undercut industry all over the world. And you might say, why should we care? If China wants to sell us inexpensive cars, why should we care? Well, it's also a national security risk because these cars can go around picking up information, just like we were upset that there was a Chinese spy balloon overhead that went around picking up information. And they can send it back to China. And the Chinese government can stop these vehicles from remote if we got into a conflict over Taiwan or something like that. They would have the ability to do that. Well, if you have OnStar from GM, GM can stop your car if you report it's stolen. Let me tell you, if GM can stop a car if it's reported stolen, I can assure you

that BYD can stop a car, even if it's not reported stolen, or through a software update, it can interfere with the navigation system and the braking system. It's a scary stuff, Diana. So I don't think we want to be dependent on cars from a country that's not particularly friendly to us. I think that's very important. And I would be in favor of banning Chinese EVs completely, not just the ones that come from China, but also the ones that come through Mexico.

Because under the USMCA, the trade agreement we have, we are able to ban items if they have national security or economic concerns. And why would Mexico fall in that category as well? Oh, because the Chinese are setting up factories in Mexico. They know that people like me want to ban exports from China. So they say, okay, we'll just build our factory in Mexico. We'll import them from Mexico to the United States under the trade agreement. I see, I see.

So it's not as though we want to ban everything from Mexico, but Chinese vehicles that are put in Mexico. Got it. We want to ban those. What is the financial effect? I mean, how does importing all of this green energy from China, how much is that costing the United States? We can see that electricity bills have steadily gone up. We can see that states that are dependent on renewables have a price of about 40 cents per kilowatt hour compared with about 11 cents per kilowatt hour for a state that does not mandate renewables.

So we can see that requiring renewables drives up energy costs. We can see that electric vehicles are more expensive. expensive to purchase than gasoline-powered vehicles. And it's harder to buy used electric vehicle. About 60% of the cars sold in the United States are used. If you buy a used EV, you might be afraid that its battery is going to die on you. And a new battery for an EV costs about $15,000 or $20,000. So there isn't any market in used EVs.

Okay. So basically, this forced energy transition, it's going to be very expensive for America. It's going to slow growth. It's going to result in less reliable electricity supply. There'll be more blackouts because of the difficulty of integrating the solar, the wind, then the backup natural gas and the batteries into the electricity system. And I haven't even talked about the transmission lines. These wind turbines, the solar panels are not close to where people live because people don't want them close to where they live.

So the energy has to be carried through transmission lines. And that is also difficult and has potential for wildfires. Oh, wow. We've been reading, of course, about how there are wildfires in California. And that utility there is fighting that. Okay. So then what are the solutions? What are the policy goals, the recommendations that I know you so clearly lay out here?

But what needs to change? Well, the recommendations are really common sense. Stop requiring wind and solar. Stop requiring electric vehicles. EPA passed regulations that basically mandate electric vehicles. States have passed regulations that require a certain share of electricity to be made with renewables. We don't have to pass those laws. We can repeal them.

We can roll them back. The Environmental Protection Agency has passed a law saying that, that if power plants do not sequester or bury 90% of their carbon emissions, they have to close by 2040. This is a regulation that needs to be rolled back. Imagine all these power plants closing right when all the electric vehicles went online. I mean, prices for electricity to recharge your EV would go up and there'd be more blackouts. But of course, in its power plant rule, the EPA does not mention its electric vehicle rule. Its electric vehicle rule doesn't, mention, oh, by the way, all these power plants might close in 2040 right when you're

buying your EVs. Do you see what I'm saying? Yeah. But we can roll back these regulations. We can roll back these laws. We don't have to have subsidies for green energy. So that's number one recommendation. A good place to start, certainly, and a practical place.

Yeah, and it's very possible. It's very possible. I mean, it doesn't, it's not rocket science. It's common sense. Yeah, yeah. Well, I want to encourage all of our listeners. to go to the Heritage Foundation website, Heritage.org, and pick up, read a copy of how the forced energy transition and reliance on China will harm America and continue to follow this project

of Chinese handcuffs that really dig so deeply into what is happening in this relationship between America and China right now and who the winners and losers are. Diana, I really appreciate your time today and I appreciate the work that you're doing to just expose what's really happening in this situation. Well, thank you so much, Virginia, for having me on the podcast. And everybody should know that they should not worry about energy because we have all this oil and natural gas. And we have plenty of critical minerals. And all the government has to do is say, you know, drill, frack, whatever you want, mine those critical minerals here.

And then we will not have to worry about dependent subject. Excellent. Diana, thank you. Thank you. With that, that's going to do it for today's episode. you for being with us here on the Daily Signal podcast. Don't forget to hit that subscribe button, so you never miss out on our morning interview editions or our afternoon top news. We'll be back here around 5 p.m. for top news and a quick heads up for Monday since it's Labor Day. The Daily Signal team will be off and we will not have either a morning interview show or a top news edition,

but we'll be back with you on Tuesday. But make sure that you join us back here around 5 to catch up on the news before the long weekend. Have a lot. A great rest of your Friday. We'll see you back here at 5. The Daily Signal podcast is made possible because of listeners like you. Executive producers are Rob Blewey and Katrina Trinko. Hosts are Virginia Allen, Brian Gottstein, Tyler O'Neill, and Elizabeth Mitchell. Sound designed by Lauren Evans, Mark Geinney, John Pop, and Joseph Von Spakovsky.

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