When it comes to California鈥檚 efforts to tackle climate change, China and California are linked in a critical way: The world鈥檚 most populous country processes the vast majority of rare metals needed for electric car batteries.
This week Gov. Gavin Newsom, a Democrat, is touring China with an emphasis on the environment, namely on how California and China can cooperate on climate.
Newsom is the third California governor in a row to make an official trip to China, and he does so at a moment when California is perhaps more heavily dependent than ever on the country to meet its own climate goals.
China鈥檚 role as a raw materials processor makes it a linchpin in California鈥檚 requirement that sold in the state are zero-emission vehicles by 2035. The relationship between the two governments is a longstanding one, and California and China have traded notes on everything from climate regulation to technology in recent years.
, led by former Gov. Jerry Brown, hosts a partnership between UC Berkeley and Tsinghua University in Beijing. The state and the government share similar policies, including emissions reduction targets, electric vehicle mandates and carbon trading programs.
鈥淭hey look at what California is doing, and they treat it as a benchmark,鈥� said Mary Nichols, former chairperson of the California Air Resources Board, which sets climate and air quality control policies. 鈥淭hey definitely are watching what happens in California.鈥�
This year California met its goals for and sales ahead of target, and that rapid initial consumer uptake has been a source of pride for Newsom.
The governor鈥檚 overseas trip comes after he at the oil industry in a , where he was the only U.S. representative to speak at the Climate Ambition Summit during New York Climate Week.
On Wednesday, Newsom鈥檚 climate diplomacy reached a new level of visibility when the governor held an unscheduled meeting with Chinese leader Xi Jinping in Beijing. The two politicians discussed ways to 鈥渁ccelerate our progress on climate in meaningful and substantive ways,鈥� Newsom said, according to .
The trip comes at a tense moment in U.S.-China relations. Last week, the differences in world alliances were on full display as .
By keeping his focus on climate change and cooperation, Newsom has the chance to sidestep some diplomatic thorniness.
California鈥檚 climate regulations
Unlike the U.S. government, California has enshrined specific greenhouse gas emissions reductions targets into law. China has also taken that step, though its , with the Chinese government seeking to achieve carbon neutrality by 2060, 15 years after California鈥檚 target.
China also modeled its carbon-trading market on California鈥檚 cap-and-trade program, which was launched in 2013 and under Brown. in 2021.
Earlier this month, the governor signed two bills into law aimed at forcing large companies to disclose their greenhouse gas emissions and their financial risks. Given that many major U.S. companies have operations in China, getting clear industry data in that country will be critical for these reporting requirements.
The California Air Resources Board 鈥渋s going to be examining the data that is submitted by companies that are subject to our statutes, and the Chinese are going to be very interested in following what California is doing 鈥� as they always are,鈥� Nichols said.
, a Democrat from Calabasas who also serves on the , said data from China will be important going forward.
鈥淐hina is very clean in some parts of their system and very dirty in others, so data is everything here,鈥� Stern said.
China embraces electric cars
In some aspects, the Chinese are ahead of California in clean vehicle adoption. The governor on his trip this week visited the Guangdong province, where the city of Shenzhen was the world鈥檚 first to adopt an all-electric bus fleet, with 16,000 buses and 40,000 charging stations, according to the governor鈥檚 office.
The Chinese electric vehicle company BYD has a battery-electric bus manufacturing plant in. Newsom on Tuesday test-drove a hybrid vehicle manufactured by the company.
鈥淭hey look at what California is doing, and they treat it as a benchmark. They definitely are watching what happens in California.鈥�MARY NICHOLS, FORMER CHAIRPERSON OF THE CALIFORNIA AIR RESOURCES BOARD
The governor also has plans to visit an offshore wind facility in the province of Jiangsu. His administration envisions producing 25 gigawatts of electricity by 2045, powering 25 million California homes and providing about 13% of the state鈥檚 power supply.
And the Chinese are a critical supplier of electric vehicles to the world. The governor will complete his trip in Shanghai, visiting the Tesla Shanghai gigafactory, the world鈥檚 most productive electric vehicle plant.
California鈥檚 electric car mandate has helped kick off an automobile industry race to make cheaper, longer-lasting batteries that take less time to charge. The demand for electric vehicles has, in turn, sparked a worldwide rush to mine the needed materials, and China is at the center of that rush.
Chinese vendors have a near-complete monopoly on processing essential car battery materials.
Biden鈥檚 EV battery incentives
The Biden Administration is aiming to change that dynamic. The federal Inflation Reduction Act requires that by next year at least half of the be sourced in the U.S., or from a country that the U.S. has a free trade agreement with, in order for electric car buyers to qualify for rebates. That does not include China. The share of sourced materials increases to 80% in 2026. Chinese vendors are looking to develop their ties with companies here in the U.S. in response.
Nevertheless, the Chinese hold 80% of the world鈥檚 cobalt processing, which is used for lithium NCM batteries, along with 76% of the world鈥檚 natural graphite processing, 56% of synthetic graphite and 60% of the world鈥檚 processing capacity for lithium compounds, according to the U.K.-based firm TechInsights Inc.
China also produces 50% of the world鈥檚 sodium hydroxide, which is used for sodium ion batteries.
鈥淐hina has developed the battery supply chain for many years in advance of other countries,鈥� said Kevin Mak, an analyst for TechInsights Inc. 鈥淭he Chinese government planned this early on.鈥�
Mines and factories in Africa, Australia, South America and Asia produce the raw materials for batteries, and the hunt for those metals has become increasingly intense, with exploration in the now being considered. Deep seabed mining is also underway, with China poised to dominate that particular underwater push, .
鈥淐omponents right now 鈥� and in the future 鈥� are going to be vulnerable to control by the Chinese and their partners.鈥�DUNCAN JEPSON, FORMER HONG KONG ATTORNEY, AND LABOR AND HUMAN RIGHTS INVESTIGATOR, WHO NOW LIVES IN LOS ANGELES
China has forged other key economic and trading relationships that governments may have to rely on as they seek solutions for the climate crisis. has made $1 trillion in infrastructure investments in developing countries across the world.
鈥淭hose relationships will affect supply chains on many materials,鈥� said Duncan Jepson, a former Hong Kong attorney, and labor and human rights investigator, who now lives in Los Angeles. 鈥淐omponents right now 鈥� and in the future 鈥� are going to be vulnerable to control by the Chinese and their partners.鈥�
An antagonistic relationship with the United States could make tackling those initiatives more complicated 鈥� and a relationship with California might help.
鈥淥ne thing you have to consider here is that, particularly in California, you do have the largest Asian population, and a very large Chinese population, and that鈥檚 meaningful,鈥� Jepson said. 鈥淐alifornia looks east.鈥�
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