Contributed by Wyatt C. King, Director, Albright Stonebridge Group

Every five years, China's Central Government issues a new Five-Year Plan (FYP), a detailed outline of the country’s economic goals for the upcoming  ve-year period. The current FYP—the 12th—covers the period from 2011to 2015.

The 12th FYP, which has been hailed as the “greenest” ever, calls for an increase in non-fossil fuel use to satisfy 11.4 percent of electricity demand. It also singles out seven “Strategic Emerging Industries” for special support, three of which are based on emerging energy technologies: new energy, energy conservation and environmental protection, and clean-energy vehicles. The Chinese government plans to invest hundreds of billions of dollars in developing these industries over the period covered by the Plan.

It is clear that China views clean energy as a strategic priority and wants to secure a commanding global position in industries ranging from solar panels and wind turbines to smart meters and electric vehicles. This carries both opportunities and threats for the rest of the world.

The major benefit is that the dramatic expansion in Chinese clean energy manufacturing is helping to drive steep declines in prices for these technologies, making them more accessible and competitive.

The major drawback, however, is that the flood of cheap products on the global market is putting significant pressure on non-Chinese manufacturers. Numerous U.S. and European clean energy companies have been forced into bankruptcy, and survivors are scraping by on razor-thin margins. There is growing concern that China’s subsidies are anti-competitive, and therefore violate international trade agreements. Earlier this year the U.S. Department of Commerce made just such a  nding regarding China’s support for its solar companies, and authorized retaliatory tariffs.

Regardless of the ultimate outcome of these trade disputes, however, the Chinese clean energy juggernaut shows no signs of slowing. China wants to win the global clean energy race, and it’s not hard to see why. Driven by growing concerns about climate change, pollution, and rising prices for coal and oil, demand for clean energy is growing rapidly. The sector is poised to become big business in the decades ahead.

So, is the U.S. response to the Chinese challenge limited to defensive measures? Or does the U.S. have its own affirmative plan to lead? Unfortunately, not really. The U.S. is blessed with an abundance of clean energy entrepreneurs, but no national strategy to provide them with consistent support. Instead, there is a patchwork of policies, often varying by state and of uncertain duration. As a result, U.S. clean energy companies face ambiguity and repeated cycles of boom and bust, making it exceedingly difficult to establish a solid foundation from which they can grow.

People don’t plan to fail—they fail to plan. This old maxim about success is just as applicable to nations. Faced with the lack of a comprehensive U.S. strategy to support clean energy, many U.S. companies are looking overseas for more favorable conditions to support their growth—many are even looking to China.

Wyatt C. King is a Director at the Albright Stonebridge Group, an international strategy firm based in Washington, D.C.

Contributed by Wyatt C. King, Director, Albright Stonebridge Group

This oil-rich nation isn't taking any chances.

This is a tale of two countries.

The first is a global leader in petroleum, pushing aggressively to develop offshore oil fields. Thanks to recent new finds, it is poised to become one of the world’s top oil producing nations in the next ten years.

The second country is a global leader in renewable energy. In 2011 it derived more than 88 percent of its electricity, and over a third of its liquid fuels, from renewable sources. Wind is the fastest-growing source of power, and new policies are expected to provide a major boost to solar too.

Can you guess which countries these are? Here’s a hint: they are one and the same. Brazil.

Brazil’s approach to energy truly epitomizes an “all of the above” strategy. Remarkably, since enormous oil discoveries were made off the southeast coast in 2007, Brazil’s efforts to diversify its energy economy have only accelerated, creating exciting opportunities for energy companies of all kinds.

When fully developed, Brazil’s offshore deposits could vault the country into the upper ranks of the world’s oil-producing nations. Last year, Brazil was the 11th-largest oil producer; by 2020 it is projected to be in the top five. By that time, Petrobras (the state-controlled oil company) expects to be pumping 4.9 million barrels each day, of which 1.5 million will be exported. If all goes according to plan, the government stands to enjoy a significant spike in revenues.

Some countries facing such a windfall might ease up on alternative energy development. Brazil, however, has maintained a deep commitment to a diverse, and largely renewable, energy supply.

Biofuels are a great example. Brazil’s sugar industry produces enough ethanol to provide approximately 40 percent of the fuel consumed by its cars. (More than half of Brazil’s cars are “flex-fuel” – able to run on either ethanol or gasoline – a figure that is set to reach 90 percent by 2017.) And compared with corn, sugarcane is an environmentally-superior source of ethanol, yielding nearly seven times as much product for every unit of energy input.

Brazil is also a global standout in renewable electricity. 75 percent of its power comes from hydroelectricity, and another 6 percent from biomass (much of that also from the sugar industry). But the country’s fastest-growing power source is wind. Projections call for 8.5 gigawatts of installed wind capacity by 2016, and more than 15 gigawatts by 2020.

Other countries could learn from Brazil’s eminently pragmatic approach to energy. Even as the wind industry in the United States is withering due to Congress’ failure to extend a vital tax credit, Brazil has just passed nationwide net metering legislation to create incentives for distributed renewables. While the Brazilian people celebrate the recent oil discoveries – the president’s response was that “God must be Brazilian” – and hope they will be a boon to development, they do not view them as a reason to ignore other abundant sources of energy. By cultivating true energy diversity, Brazil is building a sustainable energy system for the long term.

Wyatt C. King is a Director at the Albright Stonebridge Group, an international strategy firm based in Washington, D.C.