China’s dominance in the clean-energy supply chain , and a deterioration in relations, has prompted American policymakers to push for a build-up of the US’s own capacity. Analysts pointed out that the US is still a long way from achieving supply chain independence. The US Department of Energy (DOE) last month released America’s first comprehensive plan to increase its supply chain independence in the clean energy sector. It aims to establish the US as a global leader in clean energy manufacturing and innovation to compete with China . “When it comes to clean energy, China has spent years cornering the market on many of the materials that power the technologies that we rely on. That’s why I committed us to build a clean-energy supply chain stamped ‘Made in America’,” said President Joe Biden on a virtual round table two days before the release of the DOE report. “We can’t build a future that’s made in America if we ourselves are dependent on China for the materials that power the products of today and tomorrow.” The Biden administration has ramped up the country’s ambitions to achieve a carbon-free society by 2050. The White House has also acknowledged that the US faces vulnerabilities in the clean-energy supply chain because of China’s dominance over the years. China is the world’s major supplier of solar modules, accounting for over 70 per cent of global production, according to energy research consultancy Wood Makenzie. For wind turbines, Chinese manufacturers have not made quite such significant inroads into overseas markets, but still account for half of global manufacturing. China leads the world in lithium-ion battery manufacturing, accounting for 88 per cent of global battery storage production capacity. According to DOE data, China refines 60 per cent of the world’s lithium and 80 per cent of the world’s cobalt, two key inputs into high-capacity batteries. There is another incentive for the US to reduce its clean-energy dependence on China. More than 40 per cent of global solar grade polysilicon comes from Xinjiang province, where the US has repeatedly accused China of human rights violation and applied sanctions to several local clean-energy companies. Because of China’s growing ownership and production share in the supply chain, the risk of a slowdown in global decarbonisation is possible, and ensuring geographical diversity of import-dependent minerals is required. In response to China’s dominant position, and growing geopolitical concerns, the US has introduced policy and taxonomy measures designed to put the spotlight on the sustainability of clean energy investments and to offer greater support for local manufacturers. Last month, President Biden announced an extension of tariffs imposed by former president Donald Trump on most solar panel and cell imports from China and other countries for four more years. The DOE also announced US$44 million of funding to provide technologies to domestic supplies of critical elements for clean energy. It is also establishing a new “manufacturing and energy supply chains office” to strengthen and secure domestic energy supply chains. But it requires more than tax breaks and stricter market-entry regulation to compete with China. Stronger government-led financial support is needed, and the US will still have to rely on China and other countries in the medium run, analysts said. Without financial support, companies are unlikely to consider significant expansion in the US. In the solar sector, for instance, even under the right policy conditions it would still probably take four to six years for the US to achieve supply chain independence and meet 60 to 70 per cent of demand domestically, according to Edurne Zoco, executive director at information provider IHS Markit. “Even if the US were to ramp up all current module manufacturing facilities to full capacity, it could only meet the demand of roughly a quarter of the solar installation pipeline anticipated in the next few years, while still having to source wafers and cells from China, Southeast Asia, and other regions,” said Zoco. The DOE plan also carries the risk of wasting government money if not targeted right, according to Alex Whitworth, research director at Wood Makenzie. “The US should invest and build its clean energy supply chain, but in some areas such as solar modules the gap is so large with China that it may not be worth it and could raise costs significantly,” said Whitworth. “No country can do everything itself, both China and the US have to face this reality.”