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    Letters From The Earth

    China means business

    ...

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    Calvin Frost11.16.18
    In my last column I wrote about the importance of photosynthesis.  I said photosynthesis “is the essence of life.” I spent most of the column discussing the biological process of photosynthesis and the importance of sun energy as the catalyst, or the initiator, for the process. Finally, I said I would discuss the growth of solar energy and why harnessing the energy of the sun makes so much sense.

    Some of you are probably saying he’s gone wacky.  What does photosynthesis have to do with environmental issues in packaging? Really, it’s very simple: the energy of the sun, which is critical for photosynthesis, is also one of the answers to replacing fossil energy that we all use every single day. Fossil eneregy increases our carbon footprint. Solar energy, on the other hand, reduces carbon footprint. How many of you use solar energy at your manufacturing facilities? How many have installed solar panels at your homes?  A fact you may not realize is the incredible growth of solar energy both here in the US and throughout the globe. We see wind turbines, but most of us are not aware of the huge installations of solar panels, particularly in the west and the far west. Solar energy is a “game changer,” along with wind and W-T-E (waste to energy).

    Unfortunately, here in the US, we have a decided prejudice against renewable energy in favor of domestic coal and oil.  Hence, while there is growth here, there is a lot more growth in places like China, where they see an opportunity to replace fossil energy sources.  For example, we now tax imported photovoltaic panels made by the Chinese and used here in the US. This has slowed the growth of solar energy. This is so ironic as solar energy is one of the largest job producing industries in renewables.  As Mark Marion, a senior vice president at JUWI Americas, a developer of utility-scale solar power stations, based in Boulder, CO, says, “It’s like driving a car fast and slamming on the brakes!” I don’t get it: we have a free source of energy, it is renewable, it is environmentally friendly, it reduces carbon dioxide emissions, it provides jobs and it’s competitive. It is so typical of mindless thinking and political boondogglery.  What is fascinating to me is a continuing shift from coal to alternatives, despite the effort by our current administration to the contrary.  The Energy Information Administration (EIA) states that “coal consumption continues to slip, and production is 35% lower than its peak in 2008. The United States now generates 30% of its electricity from coal, down more than 50% from a decade ago. ... Oil consumption in the US is no more than one million barrels a day, less than it was in 2005 during one of the highest demand cycles.” 

    So, new and cleaner fuel sources are becoming mainstream, and it is hard for me to understand tariffs that impede a technology like solar.

    Not so in India and China, the two most populated countries in the world.  They have embraced renewables, particularly in China, and the use of solar energy in day-to-day applications, as well as huge research and development projects that continue to grow. China’s use of solar energy is going bonkers, to say the least.  Here are some examples:

    Huawei (pronounced HWA-WAY) Technologies is located in Shenzhen in a huge two square miles of manufacturing facilities.  Huawei is the world’s largest maker of telecommunication equipment. (Funny how everything in China is “the largest.”) But I can attest to the size of Huawei. I’ve been past their headquarters several times and it is enormous.  Huawei, by the way, operates in 170 countries, employs 180,000 people and last year had sales of $92 billion.

    These days it’s leveraging its telecom experience to corner what it sees as the next big thing: solar energy. The company’s main solar product is a suitcase-sized device called an inverter, which changes the direct current, or DC, that a solar panel produces into the type that can be fed into a power grid: alternative current, or AC.

    In this case, Huawei is converting the DC current from the sun into alternating current, AC, with their clever inverter. They haven’t dropped prices or stolen secrets, they have, at least for now, beaten the competition with innovation. Is Huawei government-supported? Of course, but so what. They are utilizing a free source of energy that ultimately reduces carbon dioxide emissions. Here’s what Jeffrey Ball had to say about Huawei in the July-August issue of Mother Jones:

    “Though inverters have been around for more than a century, many of the features Huawei offers are new, designed to improve the reliability of remote solar farms.  A passive cooling system dissipates heat more reliably than fans, which are prone to breakage.  And communications technology allows technicians to diagnose problems remotely, so they don’t have to venture into the field.  Huawei is the top supplier of solar inverters globally, commanding 20% of the world market.  With 800 solar-inverter engineers in research and development centers spanning China, Europe, and the United States, Huawei, which translates from Mandarin as “Chinese achievement,” presents a glimpse at the clean-energy juggernaut that is today’s China.  In 2017, Huawei spent $13.8 billion on R&D.  That amounted to 15% of its revenue – a higher portion than at Apple, Samsung, or Microsoft.”

    If you think about China in historical terms, you probably think cheap, copies, shoddy and unreliable. I think what we’re seeing now in terms of renewable energy and a focus on CO2 reduction is a commitment by “the party” to make changes for improvement in their carbon footprint at all costs.  A recent example, of course, is their National Sword program, which affects the importation of waste paper:  no more “mixed paper,” at all, and only ½% of contaminations allowed in old corrugated containers (OCC).  China is serious about both: The use of the sun as a source of energy and no more crap in their raw material purchases. Chinese President Xi Jinping believes that clean energy innovation is critical to economic growth.

    Huawei Technologies is only one of a number of Chinese companies focused on solar energy. In Shanxi province, for example, is Longi Green Energy, a manufacturer of silicone elements, which is the most important part of a solar panel. Because they have become so efficient at making silicone wafers, their customers include every major panel manufacturer, not just in China but throughout the world. This includes Elon Musks’s Gigafactory in upstate New York. That’s right, a factory widely billed as ushering in a resurgence of American solar ingenuity gets some of its most important components from China!

    There’s another state-owned enterprise called State Grid.  Today, this company has annual resources of $315 billion, more than 10 times as much as America’s largest power producer. 

    Do I either believe or support Chinese Communism? The answer is unequivocally, NO!! China is fascinating and just like America, when committed to a project (US in WWII) they pull out all the stops for a successful conclusion. Climate change is real.  Whether creating energy or making packages that have pressure sensitive labels, our focus must be to reduce our carbon footprint.

    Andre Revkin, in the July issue of National Geographic, says:

    The real shape of what’s happening to Earth emerges only when the greenhouse emissions surge is considered alongside other metrics for human activity.  A 2015 scientific report titled “The Great Acceleration” included a planetary dashboard of graphs carting signals of human activity, from tropical forest loss to paper manufacturing to water use. Most have the same shape as the curve for CO2 emissions. Pollution and climate impact, then, are symptoms of a broader situation:  the human-Earth mash-up moment that’s increasingly called the Anthropocene.

    He’s spot on! So are the Chinese in their quest to harness the sun with inverters and new technology.  We can do the same, here in America, the best, most innovative country in the world.  Yes, photosynthesis is the essence of life.  May the sun shine bright for generations to come and, particularly for you, in 2019.

    Another Letter from the Earth.


    Calvin Frost is chairman of Channeled Resources Group, headquartered in Chicago, the parent company of Maratech International and GMC Coating. His email address is
    cfrost@channeledresources.com.
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