Zhang Rui: New Energy Catalyzes a New World Order, How Can China Seize the Opportunity?

Global energy politics has always been a core issue concerning the vital interests of nations. For a long time, fossil fuels have dominated energy systems due to their scarcity and central role, making competition for them a major cause of conflicts. If one day oil and gas rigs are replaced by wind turbines and photovoltaic systems, and energy becomes more accessible, will the likelihood of countries fighting over energy interests decrease? Will the international order change?

Young scholar Zhang Rui, who works with the Global Energy Interconnection Development and Cooperation Organization, has long participated in frontline transnational energy governance activities and has conducted field research in many Asian, African, and Latin American countries. His new book, Green Revolution: The Great Energy Transformation and the New World Order, published this February, focuses on issues such as international energy politics in the era of carbon neutrality, power shifts, diverging paths of transformation, competition in energy supply chains, and new cooperation networks.

How will the “green revolution” in the global energy system alter the old energy power structure? Will it deepen or bridge the “North-South divide”? How should developing countries respond? How can China seize opportunities and address challenges? How has the recent Russia-Ukraine conflict shaken the global energy landscape? Recently, Observer.com interviewed Zhang Rui, inviting him to interpret these questions and share insights from his visits to African countries.

On July 2, 2023, in Zhoushan, Zhejiang, wind turbines on Daqiao Island in Daishan County are slowly turning with the sea breeze. Photo source: Visual China

【Text / Observer.com Wang Kaiwen Editor / Feng Xue】

Observer.com: You categorize the climate crisis, energy transition, and the Russia-Ukraine conflict that erupted in 2022 as the three major variables shaking global energy politics. Why is the Russia-Ukraine conflict so important to the global energy situation?

Zhang Rui: The impact of the Russia-Ukraine conflict on global energy can be summarized by two sentences from my book: one is “redefining the command of global energy flows,” and the other is “accelerating the catalytic role of the global energy transition.”

“Redefining the command of global energy flows” mainly refers to the post-conflict emergence of camp-based divisions in the international oil and gas markets—namely, “anti-Russian energy” versus “using Russian energy.” The US and Europe formed an “anti-Russian energy camp” led by Western countries, using energy sanctions as a means to pressure Russia into changing its behavior. Russia, on the other hand, based on cheap energy products, targeted emerging markets and developing countries, aiming to build a new energy export network that bypasses Western sanctions.

Beyond the Russia-Europe relationship, we see new energy connections emerging around Europe’s periphery. For example, before the Ukraine crisis, the EU focused on promoting clean energy development in Africa, urging African countries to accelerate the phase-out of fossil fuels. After the crisis, driven by energy security concerns, the EU strengthened cooperation with African oil and gas producers and increased imports of African hydrocarbons. Large projects like the Nigeria-Morocco gas pipeline received early EU funding in 2022, potentially shaping EU-Africa economic relations for the next 10-20 years.

Cross-border power grids, previously slow to develop, have been prioritized regionally. In 2022, Azerbaijan, Georgia, Hungary, and Romania agreed to jointly develop nearly 1,200 km of submarine cables across the Black Sea to import more electricity from Azerbaijan and address Central and Eastern Europe’s power shortages. France, the UAE, Saudi Arabia, and Greece are also advancing transnational grids connecting the Middle East to Europe, facilitating the transfer of surplus solar power. These new energy corridors not only support electricity trade but also open new horizons for energy geopolitics.

As for “accelerating the global energy transition,” the conflict has caused volatility in oil and gas markets and intensified geopolitical struggles, highlighting the economic viability of renewable energy technologies and the reliability of domestic green resources. The EU’s vigorous investment in clean energy has spurred other countries, especially major economies worldwide, to accelerate their energy transitions. Over the past two years, global investments in energy transition have grown rapidly, reaching over $1.1 trillion in 2022—setting a new record and equaling fossil fuel investments for the first time. In 2023, investments in low-carbon energy reached $1.77 trillion.

On September 28, 2022, gas leaking from the “Nord Stream 1” pipeline in the Baltic Sea’s Swedish economic zone. Photo source: Visual China

The more volatile the fossil fuel markets, the stronger the momentum for energy transition. For example, Thailand experienced a surge in new energy vehicle sales starting in 2022. The Russia-Ukraine conflict nearly doubled fuel prices in Thailand, sharply increasing the cost of traditional vehicles, which encouraged consumers to try electric vehicles. Thailand’s high temperatures and small land area mean EVs perform well in terms of range and driving experience, further boosting sales.

Another example is Ethiopia. In February this year, Ethiopia announced it would ban the import of fuel-powered vehicles, allowing only electric cars in the future—the first country globally to do so. This decision was driven by necessity: in 2023, Ethiopia spent nearly $6 billion on fossil fuels, over half of which was for automotive fuel. Transport and logistics minister Alemu Sime stated that Ethiopia’s foreign exchange reserves are limited, making it unable to continue importing gasoline, and that the country will vigorously develop electric vehicles. The intertwined nature of risks and opportunities in energy transition makes Ethiopia’s forward-looking move worth watching.

These examples reflect the profound influence of the Russia-Ukraine conflict.

Observer.com: The EU Commission proposed the “REPower EU” plan two years ago to gradually reduce dependence on Russian fossil fuels by 2030. Can you update us on the progress? How has it impacted Russia’s energy industry?

Zhang Rui: In terms of reducing reliance on Russia, the EU has made significant progress over the past two years, largely meeting expectations. Data shows that after the conflict erupted, EU imports of oil, coal, and gas from Russia plummeted.

For coal, in 2021, Russia accounted for about 50% of EU coal imports. By August 2022, the EU began banning coal imports from Russia, and by October that year, imports from Russia dropped to zero. For oil, Russian share of EU imports fell sharply from 28% in Q4 2021 to 3% in Q4 2023. Natural gas from Russia, which made up 33% of EU imports in Q4 2021, decreased to 13% in Q4 2023, with the US becoming the EU’s largest gas supplier (22%), followed by Norway (21%).

This shows the EU replacing its reliance on cheap but politically unreliable Russian energy with more expensive but politically “reliable” dependence on the US, which comes at a high economic cost.

The more cautious approach of “first build, then break” in energy transition has now shifted to “break first, then build,” with the EU bearing the burden of rapid change. On May 18, 2022, the European Commission officially launched the “REPower EU” plan to achieve energy independence and green transformation. In 2023, the EU also released the Green Deal Industrial Plan, the Zero-Emission Industry Act, and the Critical Raw Materials Act.

On August 30, 2022, solar panels in Germany’s Gelsdorf, West Germany. Photo source: Visual China

Under strong policy support, the EU made significant progress in 2023: wind and solar power generation exceeded 25% of total electricity for the first time, reaching 27%; fossil fuel power generation plummeted by 19%, hitting historic lows; coal power dropped 26% year-on-year, accounting for 12% of EU electricity, also a record low. Meanwhile, 17 GW of new wind capacity was added, the largest increase in EU history.

From a domestic perspective, observing how the EU’s energy landscape has shifted due to the Russia-Ukraine conflict, we often see a “spectator” attitude, noting the high costs paid by Europe. However, it’s important to recognize that, if the conflict does not escalate into a continental war, Europeans have the capacity to turn crises into opportunities, stabilizing their energy security through accelerated transition. Their rapid progress in energy transition will also impact and inspire other countries, especially fossil resource exporters and major energy consumers.

In this context, China cannot just be a “spectator.” We need to analyze how the EU quickly alleviates supply pressures, “starts anew,” and promotes security through transformation from a technological and geopolitical perspective. Whether they succeed or fail, their experience offers valuable lessons for China’s future strategic considerations.

Regarding the impact of Europe gradually reducing dependence on Russian energy on Russia itself, it’s important to note that, although Europe has decreased reliance, energy links with Russia still exist.

Data shows that in 2023, the EU imported about 13.5 million tons of LNG from Russia—roughly the same as 2022. In oil, through processing in third countries and covert supply channels, many European countries still maintain complex ties with Russian oil.

Russia has shifted its energy exports toward emerging markets like China, India, Brazil, and Turkey, which are now major buyers of Russian oil products. Notably, India’s imports of Russian crude oil increased nearly 13-fold over the past two years, generating huge profits through processing and resale. Meanwhile, in 2023, EU imports of refined petroleum from India reached record levels; 20 of the 27 EU countries buy Russian oil via India.

Russian media estimates that in 2023, Russia earned $32.2 billion from supplying oil products to major importing countries—fully offsetting losses from reduced exports to Europe.

However, Russian crude oil exports are heavily discounted, meaning Russia is using more resources to sustain its energy export economy.

Long-term, Russia risks becoming strategically passive in energy. Before the Ukraine conflict, most foreign investments in Russia’s oil and gas sector came from Western energy giants. After the crisis, many announced partial or complete withdrawals from exploration, pipeline operations, and sales. These companies took not only capital but also key technologies needed for Russia’s energy development, which could impact future oil and gas supply capacity.

Whether this weakens Russia’s status as a major energy producer and exporter remains to be seen over a longer period.

Observer.com: As mentioned in your book, there is a “North-South divide” in the global energy transition. Compared to Western developed countries, developing nations face greater challenges and difficulties in energy transition. Having visited many Asian, African, and Latin American countries, how do these developing countries view energy transition? What are its characteristics? Are there any cases that left a deep impression on you?

Zhang Rui: Overall, developing countries support energy transition. The costs of developing clean energy sources like wind and solar have fallen sharply, and the technology is mature. Many countries see energy transition as a way to enhance energy supply, create opportunities for industrial upgrading, and generate social and environmental benefits.

However, perceptions of energy transition vary across different regions and countries in the Global South.

For example, Gulf Cooperation Council (GCC) countries that rely heavily on oil and gas exports oppose Western narratives of replacing fossil fuels with zero-carbon clean energy. They advocate for energy integration—combining fossil fuels, renewables, and new energy sources—arguing that the world cannot quickly sever ties with fossil fuels. They promote clean, efficient use of all energy types to ensure energy security and reduce emissions. Saudi Arabia and the UAE, for instance, are working to lower the carbon intensity of their oil and gas production, develop large-scale solar projects, and explore blue and green hydrogen.

On October 2, 2018, in Saudi Arabia, Saudi Aramco’s oilfield facilities. Photo source: Visual China

For less developed African countries, energy transition can be summarized as “one core goal, three key actions.” The core goal is to build a modern, low-carbon, affordable energy system. “Modern low-carbon” means modernizing the energy system while reducing carbon emissions, especially addressing the severe electrification deficit—nearly 600 million Africans lack electricity. “Affordable” emphasizes that new energy systems should be cost-effective, compatible with existing infrastructure, and meet local needs without overburdening economies.

The three key actions are: promoting distributed and centralized clean energy development; accelerating grid construction to enable electricity transmission; and fostering the integration of energy industries with modern sectors to generate momentum for transition.

In Latin America, many countries rely heavily on hydropower, making their electricity systems already quite clean. For example, in 2019, Paraguay, Costa Rica, and Uruguay generated 100%, 99%, and 98% of their electricity from renewables, respectively. These countries have found models based on their abundant clean resources, focusing on improving reliability and cost-effectiveness of their clean power systems, expanding solar and wind capacity, and accelerating decarbonization in transportation and buildings.

Overall, Asian, African, and Latin American countries have made impressive progress in energy transition, but challenges remain.

For instance, Africa faces a persistent dilemma: urgent energy demand but limited scale to support large projects and sustainable operation. Many large hydropower projects are delayed due to low industrialization levels, few high-load industries, and lack of electricity markets. Small off-grid projects have helped meet basic needs but have not fundamentally changed rural livelihoods, and many suffer from unpaid bills and maintenance issues, leading to abandonment.

Any development—large-scale, distributed, or grid-based—must be driven by productive energy demand and the willingness and ability of consumers to pay. In other words, energy transition in Africa must be linked with the development of modern industries.

Ginea’s case left a deep impression. During a field visit near Conakry, local officials told us that farmers used to only use solar power for lighting and TV, without developing productive energy needs. But with mechanization and mobile commerce, farmers now need machinery for processing and direct sales, prompting them to buy solar systems or pay for reliable electricity.

When villagers see electricity as a way to earn income, they are more motivated to maintain the power system, which in turn attracts reinvestment. This creates a virtuous cycle linking energy, agriculture, and telecommunications.

I believe that many failed energy transition cases stem from focusing solely on energy issues without considering broader economic and social systems—failing to help developing countries find suitable pathways.

On October 16, 2023, in Doma, Nigeria, a hybrid microgrid powered mainly by solar energy. Photo source: Visual China

Observer.com: As the share of new energy continues to rise, how will it change the old energy power structure? What are the characteristics of energy power in the new era?

Zhang Rui: I have a core view in my book: I believe the rise of new energy can create new politics.

For a long time, global energy politics has been dominated by geopolitics over fossil fuels and their scarcity, with control over oil and gas resources being a major source of international disputes.

I think, as the strategic value of oil declines and clean energy sources like solar and wind gain importance, the global energy landscape will shift—more competition but at lower intensity.

“More competition” means that as the variety of energy sources increases, each may generate benign or malicious competition. Additionally, clean energy supply chains are more complex, involving critical minerals, manufacturing, and technology. Major economies will compete across these supply chains. The US and Europe have been suppressing China in this area because they see dominance over clean energy supply chains as crucial to future energy power.

“Lower intensity” refers to the diversification of energy sources reducing the need for high-intensity conflicts, especially military conflicts, over energy.

After the Gulf War, Kuwait’s northern oil fields burned. Photo source: Visual China

I believe that developing clean energy can enhance countries’ energy self-sufficiency and strategic autonomy. For many fossil fuel importers, large-scale domestic clean energy development can safeguard energy security, weaken external constraints, and reduce risks in policymaking. It also helps improve trade balances and save foreign exchange, boosting economic growth.

For many small and medium countries, clean energy can weaken the “protectorate and vassal” logic in international order, allowing them to pursue greater political independence alongside energy independence—an essential aspect of 21st-century multipolarity.

In summary, energy transition promotes diversification of energy needs. A heterogeneous, decentralized energy system aligns with a more multipolar world order. When countries have different energy demands, priorities, and flexible cooperation networks, it becomes harder for hegemonic powers to control key resources, hubs, or corridors, making global energy monopoly increasingly difficult.

Observer.com: Which countries are more likely to be “winners” in the era of new energy?

Zhang Rui: Broadly speaking, three types of countries may gain more influence globally: first, those with huge potential for clean energy development, like Australia, Chile, Brazil, and Norway; second, countries rich in critical minerals, such as Bolivia, Mongolia, and the Democratic Republic of Congo; third, leading nations or economies in clean energy technology, like China, the US, and the EU.

Observer.com: How should China seize opportunities and face challenges amid the shifting global energy power landscape?

Zhang Rui: We need to recognize China’s new role in the global energy order. Historically, China’s role was mainly as a large consumer of oil and gas, so ensuring diversified energy imports and stable trade has been our top priority.

In the era of carbon neutrality, China bears multiple roles: a major energy producer and consumer. Its strength in clean energy supply chains, nuclear power, and power engineering has made it a global energy supplier and a new “energy exporter.”

When Western countries’ clean energy equipment largely come from Chinese firms, and many infrastructure projects in Africa, Asia, and Latin America are designed, built, and operated by Chinese, and Chinese brands are increasingly visible on streets worldwide, we should see ourselves more clearly and confidently. Two epochal changes have emerged in China’s energy relations with the world:

1. The unprecedented synchronization between China’s energy transition and the global energy transition.

2. The close interdependence between China’s energy industry strength and the global energy system’s capacity.

This new identity and relationship are China’s greatest opportunities. But challenges remain.

First, China is still a major importer of oil and gas, with high external dependence. Maintaining energy import security amid intensified great-power competition remains a key national security issue.

Second, clean energy technology has become a focal point of US-China “tech Cold War” and “green arms race.” The Biden administration’s strategy to reshape supply chains aims to reduce dependence on Chinese resources and products, developing “decoupled” clean energy tech with allies, and applying industry and political pressures on China.

On July 30, 2023, in Haixi Prefecture, Qinghai, a molten salt tower CSP plant. Photo source: Visual China

In fact, Western attitudes toward China are contradictory: they urge China to accelerate energy transition and shoulder climate responsibilities, hoping China can lead emerging markets; yet they also see China’s clean energy industry as a “threat,” and use political and economic measures—including false accusations of forced labor in Xinjiang—to suppress Chinese solar and other clean energy industries. This hypocrisy is evident.

China exports large quantities of clean energy equipment to Europe and the US, supporting their high-quality, low-cost energy transitions. Chinese renewable firms are expanding abroad, establishing production and sales networks in Europe and nearby regions. We do not seek dominance but aim to “grow the cake” together and build shared, cross-national industrial chains. Yet, Western countries impose political barriers to block China’s progress.

Third, in building the Green Belt and Road, we still face shortcomings in project planning, with some countries overly concentrated or clustered. Some Chinese firms face homogeneous or even vicious competition, and there is room for improvement in international technology cooperation and standards alignment. These are areas where we need to strengthen our internal capabilities.

Observer.com: You previously emphasized the importance of critical minerals. Recently, some resource-rich countries are forming alliances similar to OPEC to coordinate supply, such as Argentina, Bolivia, and Chile aiming to create a “Lithium OPEC.” Do you think similar influential resource-exporting organizations could emerge in the future?

Zhang Rui: In the future, various organizations and producer groups for critical minerals may emerge, but I believe organizations like OPEC with huge influence are unlikely to reappear.

The main reason is that many critical minerals are not scarce. For example, with increasing demand, lithium and nickel are being more extensively developed, and resources are being discovered in more regions. Many continents have significant lithium and nickel reserves, and proven global reserves are substantial. The demand for these minerals in the coming decades will be far less than the oil and gas demand of the past.

Regarding the idea of a “Lithium OPEC,” forming multilateral cooperation mechanisms is inevitable, but exerting market regulation similar to OPEC will be very difficult.

First, in the near to medium term, production scales among resource countries vary greatly. For instance, Australia accounts for about half of global lithium production. The “Lithium Triangle” countries—Chile, Argentina, and Bolivia—have very different production capacities, not on the same level. Such disparities make it hard for them to form a cartel-like organization.

Second, their regulatory systems differ significantly. In Argentina, lithium mining is under general mineral law with limited government intervention, and provincial authorities hold substantial rights over mineral resources. In Chile, the government grants mining rights through bidding, while Bolivia considers lithium a strategic resource, with the state owning all rights and controlling development.

Third, political stability in Latin America is highly volatile. Two years ago, leftist governments in these lithium countries pushed for a “Lithium OPEC” to coordinate policies. But political shifts or regional tensions could abruptly halt cooperation.

Observer.com: Do you hope that global energy politics can become more “normal,” with less strategic weight and power competition, where both big and small countries approach this issue with equanimity? Is this achievable? What steps are needed?

Zhang Rui: I remain optimistic. If global energy transition continues to advance, breakthroughs in energy technology could make energy development easier and cheaper, leading to a more “normal” global energy politics—less fierce competition and conflict. Achieving this depends primarily on a revolutionary leap in productivity—an energy revolution.

Additionally, the international community must work together to create a balanced, inclusive global energy governance system, resisting Western green hegemony, and promoting a fair redistribution of energy interests based on historical responsibility and justice. The goal is to build a global energy transition rooted in inclusive development rather than exploitation.

China should play a constructive role. Our focus should not be solely on adjusting energy structure ratios but on becoming a source of global energy innovation, continuously advancing transformative energy technologies and manufacturing capabilities. We should prioritize energy transition cooperation, investment, and diplomacy in our foreign strategy, helping other countries navigate the switch between old and new energy sources smoothly.

Green Revolution: The Great Energy Transformation and the New World Order, Zhang Rui, February 2024, Sanlian Publishing