By Susan Krause
Washington File Staff Writer

Washington - The United States and China must work together to confront serious challenges related to energy needs, according to Katharine Fredriksen, principal deputy assistant secretary of energy for policy and international affairs.

In a statement delivered August 4 at a hearing on "China's Role in the World," sponsored by the U.S.-China Economic and Security Review Commission (USCC), Fredriksen said both countries face increasing dependency on foreign energy sources, high prices and negative environmental impacts as their energy consumption increases.

"While there are notable differences in our approaches, cooperation between our two countries will promote greater energy security in our respective countries, as well as in the world," she said.

Fredriksen told the commission that the U.S. Department of Energy (DOE) and its counterparts in China have engaged in cooperative initiatives since the two countries normalized diplomatic relations in 1979.  That cooperation includes science and technology exchanges, joint training, demonstration programs and collaborative visits, she said.

The USCC, established by Congress to monitor the national security implications of U.S.-China bilateral trade and economic relations, convened the two-day hearing August 3.  Testimony on the hearing's first day assessed the impact on U.S. interests of China's "global outreach" - its diplomatic activities and foreign relations.  (See related article.)

The second day of the hearing sought to review China's domestic energy policies and to consider opportunities for bilateral cooperation in increasing energy efficiency and reducing competition for oil.

SEVERAL AVENUES OF ENGAGEMENT

China has become the second largest consumer of energy in the world, after the United States, and faces a range of challenges that are "unprecedented for its policymakers," Fredriksen told the commissioners.

"The United States has an important role to play in encouraging China to adopt responsible energy policies and strategies that place China in full accordance with international norms," she said.  

DOE has several avenues of engagement with China, according to Fredriksen, including both bilateral and multilateral mechanisms.

One example of bilateral engagement is the U.S.-China Energy Policy Dialogue, established in May 2004 by then-Secretary of Energy Spencer Abraham and the Vice Chairman of China's influential planning agency, the National Development and Reform Commission (NDRC).

The policy dialogue was initiated to facilitate high level discussions on a range of energy-related issues, Fredriksen said, including policy formulation, supply security, power sector reform, energy efficiency, renewable energy and energy technology options.

Another medium for bilateral discussion is the U.S.-China Oil and Gas Industry Forum.  Initiated in 1998, the forum - hosted by the Departments of Energy and Commerce on the U.S. side and by the NDRC on the Chinese side - allows U.S. officials to promote respect for market principles in the global energy market and gives Chinese officials exposure to western business customs.

"U.S. industry is already the largest investor in China's petroleum sector and continues to seek greater investment opportunities there," Fredriksen said.

At the most recent meeting of the U.S.-China Oil and Gas Industry Forum, held in New Orleans, Louisiana, in June 2005 the U.S. delegation emphasized the importance of transparency in reporting to provide potential investors with accurate information, she noted. 

Multilateral organizations and initiatives provide a variety of opportunities for cooperation, Fredriksen said.  She cited U.S. and Chinese engagement in the Energy Working Group of the Asia-Pacific Economic Cooperation (APEC) forum, a 21-member international grouping intended to promote economic growth, trade, and investment in the Asia-Pacific region.

In addition, she said, the two countries have worked together in the Asia-Pacific Partnership for Clean Development and Climate, a collaborative effort by six Asia-Pacific region economies - Australia, China, India, Japan, South Korea, and the United States - to encourage investment in the development of clean, efficient energy technology.   (See related article.)

COOPERATION ON SCIENCE AND TECHNOLOGY

The U.S. government has sought to engage China in the area of science and technology as well, Fredriksen said.

"DOE and Chinese government agencies have been cooperating in the fields of high energy physics; fossil energy; energy efficiency and renewable energy; energy information exchange; [and] peaceful uses of nuclear technologies," she told the commission.  The two countries have also worked together to develop clean energy sources for the 2008 Summer Olympic Games, which will be held in Beijing.  (See related article.)

As a result of this cooperation, Fredriksen said, China passed legislation in March 2005 promoting energy conservation and the development of renewable energy sources, such as wind, solar, geothermal, and small-scale hydroelectric plants.

The two countries have worked together on technological initiatives that promote the development of hydrogen as an alternative fuel and the construction of a nuclear fusion reactor, Fredriksen told the commission.  DOE is also encouraging China to increase its involvement in the FutureGen project, she said.

FutureGen is a U.S.-led joint public and private sector effort to design and build a near-zero emissions power plant capable of producing electricity and hydrogen from coal while storing carbon dioxide in a process called geologic sequestration.  (See related article.)

"DOE has engaged China on a number of significant issues," Fredriksen said.  "We are committed to continue our efforts in illuminating China's path towards becoming a prosperous nation and a responsible stakeholder in the international system."

For information on other energy initiatives, see Science and Technology.  For additional information on U.S.-China relations, see The United States and China.

The text (PDF, 12 pages) of Fredriksen's statement can be downloaded at the USCC Web site.