BEIJING, China—In a surprising development for a young economy, China is on its way to becoming a global environmental leader. Ernst and Young’s May report on renewable energy now ranks China and the United States in a tie as the world’s best destinations for investment in clean energy. China has made considerable headway to create a favorable environment for clean energy through forward-looking government policy, and seems likley to be a leader in the field over the coming decade. These impressive steps will strengthen economic growth and environmental protection. If the United States does not do the same, it risks losing a chance to lead an enormous new industry and solidify secure energy sources to meet future needs.

China’s role as a prime destination for investment in clean energy comes after a frenzy of intelligent economic policy and action. According to the Ernst and Young report, in 2009, China invested $34.9 billion in clean energy, almost twice as much as the United States’ commitment of  $18.6 billion. China is now the world’s leading producer of wind turbines and solar panels, and “is pushing equally hard to build nuclear reactors and the most efficient types of coal power plants” according to The New York Times. Companies from around the world are building factories in China and purchasing renewable energy parts from China, making it a central location in the world’s energy supply chain. Not only this, but the city of Tianjin is starting a pilot carbon cap-and-trade system and Beijing and Shanghai hope to do so as well. China seems to be on its way to becoming the Saudi Arabia of clean energy, holding all the keys to a crucially valuable resource.

China is motivated in a large part by energy security, the concern that its energy supply comes from dangerous and unstable parts of the world. The United States faces similar challenges. It too must deal with unreliable oil and natural gas suppliers in the Middle East and South America, and renewable energy gives us the opportunity to build new, clean sources right at home. But unlike China, our government cannot command transition to clean energy; rather, we must use legislation to take this integral step. A climate bill that put a price on carbon would create the incentives to develop clean energy, but if we don’t soon take action, we will have to transition from depending on dictatorships for oil to depending on China for clean energy as fossil fuels run their course.