About the Guest
David Fishman is a principal consultant in the China practice of The Lantau Group, an energy economics and policy advisory that works with industrial power buyers and investors across solar, wind, nuclear and coal assets. He writes Crossing the River by Feeling the Stones, a Substack on China’s emerging and lower-tier cities.
Episode in Brief
China’s “clean energy leadership” claim rests on a different definition than the West’s. Beijing frames leadership as enabling other countries’ decarbonization through mass technology exports and production volume, not necessarily as having phased out coal at home — coal alone still supplies roughly half of China’s 2025 generation mix.
China’s renewable-build targets are negotiated between industry and policymakers rather than imposed top-down, which Fishman says is why the country has repeatedly “underpromised and overdelivered” on clean-energy goals — and why the same pattern could hold on the 2030 peak-carbon target.
Energy is one of the sectors most directly run by the state, unlike China’s more bottom-up AI buildout. Local officials originate and pitch most projects; only genuinely national moves — cross-provincial power trading, a national data-compute strategy — originate in Beijing itself.
The Medog Hydropower Station, a $160–170 billion, 60-gigawatt project targeting 2033 completion, will generate roughly as much electricity annually as a mid-sized country consumes.
Western restrictions on Chinese clean-energy equipment (Chinese suppliers reportedly account for roughly 80% of EU inverter shipments) raise a tradeoff Fishman says hasn’t yet been convincingly argued: national security versus decarbonization speed.
What “Clean Energy Leader” Actually Means
Fishman opened by complicating the premise of the question itself: “leadership” needs to be defined, and China’s own version of it is not the one usually assumed in Western coverage. Beijing’s implicit standard is enabling other countries to decarbonize by supplying clean-energy technology at scale and low cost — solar panels, batteries, EVs — rather than a race to eliminate domestic emissions fastest. Both things can be true at once: heavy technology exports and a domestic grid still slightly over half thermal.
China’s own 2025 generation mix backs up that tension. Fishman’s estimate: about 55% thermal (roughly 51% coal, ~3% gas), just shy of 36% combined wind, hydro and solar, another 2-3% nuclear, and the remaining ~5% split between biomass, wave and other small sources.
On the pace of change, Fishman argued China’s official targets are structurally conservative because of how they are set: less a hard number imposed from above than a negotiation, with policymakers asking industry what it believes it can do, then testing whether it can do more. That process tends to produce targets industry is confident of hitting — and sometimes beating by a wide margin, since recent five-year build targets have in some cases undershot the country’s own trailing three-year average.
Fishman’s read is that the country’s targets are calibrated to be beatable, which has been the recent pattern.
“There’s been a lot of underpromising and overdelivering in the near recent past in the Chinese energy sector.”
— David Fishman
From Process Innovation to “Zero to One”
Fishman also flagged a shift in the character of China’s clean-tech edge. For years the country’s advantage was “process innovation” — making an already-proven technology like solar cells incrementally cheaper, faster or more efficient, driven by intense domestic competition. He now sees genuine “zero to one” innovation emerging in areas that are not yet technologically proven anywhere, citing next-generation batteries and downstream hydrogen derivatives as examples.
“Some zero to one innovation is happening in clean tech now in China, whereas China was previously known for one to one hundred, iterating an already existing concept.”
— David Fishman
Beijing Sets Direction, Local Governments Drive Execution
Asked how national priorities actually turn into projects on the ground, Fishman drew a sharp line between “Beijing support” and provincial or municipal support. Most energy projects — a data center, a solar farm — originate locally: officials pitch the idea and seek approval upward. Only genuinely national-scale moves, like cross-provincial power trading (sending hydropower from Sichuan to eastern China) or a national data-compute strategy, originate in Beijing itself.
“Local government officials in China are not principals. They are agents themselves. They are pursuing certain activities in response to their own incentives — they want career advancement, or they’re just trying to interpret national-level policy.”
— David Fishman
Fishman contrasted this with AI, where the buildout looks far less state-directed and more the product of disaggregated private activity responding to a policy-created ecosystem. Energy, the nuclear sector and grid development, by comparison, sit squarely inside the state’s direct sphere of influence.
On policy risk specifically, Fishman was direct: change happens, but it is never a reversal — only a “course adjustment.” His example was the shift away from guaranteed feed-in tariffs toward market-priced electricity sales, a change individual power-plant operators dislike but that he says most economists view as the correct design move. Unlike the US, where recipients of a policy change can lobby directly and sometimes reroute it, in China that feedback runs through state research institutes and universities: affected companies can get details softened, but they cannot block a change they oppose.
“It’s not a new direction. It’s never a reversal of previous policies. It’s a course adjustment.”
— David Fishman
Fishman’s framing: policy risk in China’s energy sector is directional and negotiable at the margins rather than existential, though a feed-in-tariff-style repricing can still hit the economics of an existing asset hard.
Inside the Medog Hydropower Station
The episode’s centerpiece was the Medog Hydropower Station, the subject of a recent Fishman article. The project features an unusually steep “hydraulic head”: the Yarlung River drops roughly two kilometers in elevation over a 200-kilometer horseshoe bend. Rather than following that bend, the plan is to drill a 40-kilometer tunnel straight through the mountain and route the river through it, capturing the elevation drop as power along the way.
“This is not a low-hanging fruit project. This is the highest fruit on the tree type hydropower project.”
— David Fishman
Transmission is the open question. Fishman said only one route is publicly confirmed — a high-voltage direct-current (HVDC) line toward the Greater Bay Area in Guangdong, likely terminating in Huizhou, though he flagged that specific city as not fully certain. Sixty gigawatts will need several more lines; he estimated three to eight HVDC routes in total. On how that power gets absorbed once it lands, Fishman made a fungibility point worth remembering: grid operators elsewhere in the country cannot tell where incoming electricity originated, so new low-cost supply simply displaces whatever is the highest-cost or highest-emission generator in the local mix.
Data Center Attitudes
On data centers, Fishman said the topic barely registers with ordinary Chinese people, for a structural reason: residential electricity pricing in China is shielded from market movements, so there is no equivalent of the US fear that a local data center will push up household power bills. Chinese media coverage reinforces this by framing data centers as high-tech development news rather than a public-interest or community-impact story.
Security Pushback
Olivia raised US and EU restrictions on Chinese clean-energy equipment on cybersecurity and supply-chain grounds, citing a Wire China report that Chinese suppliers account for roughly 80% of inverter shipments into Europe. Fishman’s response set a specific test for whether that policy makes sense: a country is entitled to define its own national-security standards, but if the replacement supply chain it builds slows its own decarbonization effort, it has implicitly ranked a national security concern above a global one — a tradeoff he said has not yet been argued for convincingly.
“Ensure that the alternative you choose — be it a different supplier or cultivation of a domestic supplier — doesn’t slow down your effort to build out your decarbonization infrastructure. If it does, then you have prioritized a national security concern over a global security concern.”
— David Fishman
