In this week's edition of The Pointillist, a spotlight on the energy transition that includes the inexorable rise of batteries, the electrification of economic development, China's dominance in electrotech, New Zealand's pathway to LNG dependency, plus a mini-essay on why renewable energy isn't just additive to energy consumption.
Yesterday the New Zealand Government announced its decision to fly further in the face of global technology trends. With details still to come, the Government has reinforced its commitment to contract a liquefied natural gas (LNG) import facility by mid-2026. (Recall that Frontier Economics, in its 2025 review of electricity market performance, described LNG as a 'last resort'.) To sufficiently subsidize this option, the Government is also proposing to use its coercive powers to impose a levy on users of the electricity system.
The options analysis is bleak, limited to burning different things in different places:
('Sir, why did you swallow that dead rat?' 'Well, I was offered a dead cockroach, a dead pigeon, a dead hedgehog, and a dead hagfish – and the rat struck me as the most palatable.')
For many people, myself included, the plausible alternative to LNG is the accelerated roll-out of solar with utility-scale batteries for short-term firming (supplemented by existing thermal generation), which enables our hydro dams to build their reserves for dry years (see the Market Development Advisory Group report). Large-scale batteries are relatively quick to install (9–24 months), yet the analysis behind the LNG decision declares that: 'Other options, including renewable projects, were considered but not advanced due to a range of factors such as expected time to construct...'
This particular decision is, I believe, a critical test for New Zealand's strategic capacity. It's also one which I fear we're going to fail, with significant implications for our future economy, and our ability to adapt in a changing technological and geo-political landscape.
Over the ditch, by contrast, Australia has become the world's third-largest market for utility-scale battery energy storage. Indeed, batteries are expected to overtake gas by 2027 as a source of supply to the electricity grid. The AFR quotes Rystad analyst David Dixon:
“You’re going from a situation where there is limited competition [during the evenings] to this scenario where you’ve got 15 gigawatts entering the market – more than the entire gas fleet,” he said.
“During the evening, this is going to have a downward effect on prices.”
He said almost half of the batteries under construction would come online this year, with the other half entering in 2027.
The change will be “transformational”, Dixon said, because the batteries will also soak up a lot of the solar and wind power produced during the day but not used – known as curtailment – which has proven to be a headache for energy investors in big solar and wind projects.
Ryan Cropp
In a fascinating story about China's largest battery manufacturer, this quote from CATL's founder Yuqun 'Robin' Zeng was striking:
The energy revolution will last for a long time, far beyond the target of carbon neutrality. The true, enormous future lies ahead in zero-carbon technologies.
It captures a pragmatic, far-sighted view that while climate change is a factor in the transition to renewable energy, the primary driver is efficiency. Even if fossil fuels did not heat up the planet, the transition to renewables would happen anyway – and China is positioning to capture this irresistible value.
Bloomberg Businessweek
There was once a consensus – at least among global elites – over a universal form of economic development. It was assumed that developing countries would travel a pathway roughly the same as developed countries, moving from agrarianism to extractive industrialization by burning up mountains of coal and other fossil fuels, and accelerating the pace of land use change. The spoils of economic growth would trickle-down to repair whatever damage was done along the way.
It is increasingly clear, however, that we cannot presume to know what future development pathways will look like: what geopolitical alliances will legitimize them, what technologies will drive them, what energy types will do the heavy lifting.
The world's two most populous nations are increasingly diverging from the 20th century archetype. As reported by Carbon Brief, coal power generation fell in both China and India in 2025, the first simultaneous drop since the mid-1970s during the oil crisis. It is a sign that structural forces are at play.
This event occurred within the context of the accelerating rollout of renewable energy infrastructure. In 2025, China is estimated to have added more than 300 gigawatts (GW) of solar and 100GW of wind power in 2025. For perspective, New Zealand's total installed electricity generation capacity is about 10GW. So, China is adding about thirty times our national capacity in solar alone in a single year.
And it isn't only scale: it's innovation in implementation. China recently completed HG14, the world's largest offshore solar farm: 1 GW of solar PV panels installed across 1,223 hectares of shallow coastal waters (1–4 metres deep) near Dongying in Shandong province. As PV Magazine reports:
'HG14 comprises 2,934 steel PV platforms measuring 60 meters by 35 meters each, supported by 11,736 steel piles. The fixed-pile design ensures stability against wind, waves, tides, and seasonal sea ice, addressing key engineering challenges for northern coastal offshore solar deployment. The plant uses over 2.3 million 710 W n-type bifacial modules mounted at a 15-degree tilt. Project data indicates offshore conditions raise generation efficiency by 5% to 15% compared with comparable onshore systems, aided by lower temperatures and sea-surface reflectivity.'
Source: https://interestingengineering.com/energy/worlds-largest-offshore-solar-farm-china / https://raillynews.com/2025/12/chinas-first-gigawatt-scale-offshore-solar-power-plant-is-in-service/
India's new renewable capacity is humble by comparison, adding 35GW of solar, 6GW wind and 3.5GW hydropower in the first 11 months of 2025. What is more telling is the direction of travel: this was a 44% year-on-year increase of renewable energy capacity. If India, the world's most populous country at nearly 1.5 billion people, can 'leapfrog' the fossil-intensive development pathways of industrialized countries, this is hugely significant for avoided global emissions.
Indeed, the evidence suggests that India, even more so than China, will bypass the worst extremes of fossil-driven development. The ternary chart (below) from a recent briefing by Ember is instructive.
If we compare India today with China at equivalent income levels ($11,000 PPP in 2012), then India has much higher solar generation and much lower coal use. China had barely any solar generation in 2012, but solar accounts for about 9% of India's electricity generation in 2025. Meanwhile, India's coal generation has potentially already peaked at about 1 MWh per capita in 2025, which is roughly 40% of China’s level in 2012, now around 4 MWh per person.
This creates new possibilities for economic development, not only for India, but also other developing countries in Africa, Southeast Asia and South America.
This isn't only about domestic adoption of technology either. It is a story of globalized technology diffusion, driven by geopolitical factors, especially China's pursuit of competitive advantage in the 21st century.
One expression of this is the growing dependency on China – by India and many other countries – for imports of electrotech like solar panels, batteries and EVs.
Still another expression is foreign direct investment (FDI) where China builds its offshore manufacturing capacity and expands its geopolitical influence.
This recent report from Net Zero Industrial Policy Lab finds that:
Chinese firms have pledged at least USD 227 billion across green manufacturing projects. A high-end estimate approaches USD 250 billion. This surge of overseas green manufacturing investment is unprecedented; it now surpasses the USD 200 billion (in current 2024 dollars) invested by the US over four years of the Marshall Plan, at a time of similar American dominance of manufacturing in key industries.
The dramatic uptick in FDI since 2021 is notable. The motivations to expand China's manufacturing footprint are described by the Lab as 'seeking access to host countries markets, access to third-country markets, or access to raw material inputs.' In other words, this is about controlling the global supply chain and asserting economic supremacy in an electrifying world.
Meanwhile, the US is cratering its own capacity to offset Chinese dominance in electrotech, as the Trump administration suffocates the national science system and associated regulatory agencies. As Nature reports:
More than 7,800 research grants terminated or frozen. Some 25,000 scientists and personnel gone from agencies that oversee research. Proposed budget cuts of 35% – amounting to US$32 billion.
And yet despite Trump's obstructionism, renewable energy continues to scale up in the US, albeit not as rapidly as countries with more favourable policy settings:
Even in the U.S., renewable generation grew substantially, with solar generation up 37% last year and wind up 12%... For at least one month, March 2025, renewables supplied more than half the electricity generated nationwide. That was the first time ever that fossil fuels supplied less than half of total U.S. electricity generation.
Economics is driving this transition: even with battery storage to smooth out the intermittent supply of solar and wind power, the costs are competitive with fossil electricity:
With battery storage added, solar generation costs five cents to 13 cents. By comparison, generating electricity from natural gas costs 13.8 to 26 cents per kilowatt-hour, according to PV magazine and Lazard. Coal is even more expensive.
Barbara Grady
Even in the UK, which not only has a natural lack of sunshine, but also faces a concocted political backlash against net-zero, the market share of solar electricity continues to grow, as captured by this neat graphic from the BBC:
Given these trajectories for electrotech, a recent proposal by Kwesi Quagraine, Mark Lynas & Erle Ellis is to turn away from temperature-based targets (e.g. the Paris Agreement targets of 1.5°C and 2°C), and to focus instead on targets for the uptake of clean energy technology.
The proposed metric is ‘clean-energy shift’, which they define as 'the growth rate in clean-energy generation minus the growth rate in total energy demand for a given time interval.' They conclude:
Most important is to avoid the insidious narrative of climate failure, which risks backlash and doomerism. Although the 1.5 °C Paris agreement cannot be saved, a tolerable and safe climate — in which humans and other species can thrive — is still achievable. This will result not from setting distant unachievable goals, but through a more modest approach: to produce enough extra clean energy each year to climb the climate ladder towards a safer future without fossil fuels.
Kwesi A. Quagraine
Finally, I want to address a dreary complaint that I hear occasionally about the energy transition. I am partially sympathetic to this critique, even though it is manifestly falsifiable. So, let me first address its falsifiability, then my sympathies.
The argument goes like this: yes, the deployment of renewable energy technologies, solar and wind especially, is gathering pace. But this is only additive: it is not displacing fossil energy consumption.
A glance at global energy data (below) appears to prove the point. Oil, coal and gas consumption all continue to rise, even while renewables begin to deliver a greater share.
However, this is global aggregate data, which obscures the unique circumstances of individual countries. In particular, the global aggregate is weighted toward very large countries, such as China and India, that are on trajectories of massive growth (and thus rising energy consumption), while overshadowing the minority of smaller countries that are deploying renewable energy technology in stabilized economies.
First, let’s look at the UK. As you can see, coinciding with the uptick in renewable energy share, there is a steady decrease in primary energy consumption. This is exactly what you would expect to see if inefficient fossil fuels were being displaced by electrical energy from renewables.
Next see Germany, where primary energy consumption plateaued during the uptake of nuclear energy, then began falling as renewables took the lead as alternative energy supply.
This post from Jenny Chase shows it even more starkly, where primary energy consumption (Primärenergieverbrauch) declines as renewable energy (Erneuerbaren Energien) increases.
So, among some individual countries, we do indeed see renewable energy supply displacing fossil fuel consumption (unless the pessimists have a better explanation for the cause behind this correlation). It is not merely ‘additive’ and, frankly, I am surprised that intelligent people put this critique forward as uncritically as they do. As other countries expand their renewable energy supply – as the UK and Germany have done – we have good reason to expect that they will crush fossil fuel consumption too. Once enough countries do this, the global aggregate will show this too.
Now for my sympathies with this argument: while these countries show that fossil fuel consumption can be reduced, it is not occurring in enough countries yet. Also, even where it is occurring, it is not occurring at the speed that the Paris Agreement thresholds require.
There are also countervailing factors, such as the electrification of private transport and the hyperscalers' pursuit of energy-intensive data centres, which threaten to gobble up new electricity supply and therefore to prolong demand for fossil electricity.
This is why I’ve advocated for supply-side initiatives like the Fossil Fuel Non-Proliferation Treaty in the past, as well as new initiatives like the proposed COP30 roadmap to phase-out fossil fuels. It is why I also see a necessary role for demand-side initiatives that reduce energy use overall. For instance, a timely energy transition is very challenging if we expect to swap from ICE vehicles to EVs on a one-for-one basis, and much easier if a large proportion of people shift to electrified public transport, or microtransport (e-bikes, e-scooters), or active transport (walking, cycling). The latter enables a faster transition, less inhibited by bottlenecks in the supply of critical minerals and new electricity generation.
But the idea that renewable energy isn’t, or cannot, displace fossil energy strikes me as a terrible canard. Worst of all, it plays into the hands of the climate obstructivists, because it makes fossil fuels seem more invincible than they really are.
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