Even in this article, it repeatedly refers to building out infrastructure in advance of an obviously approaching future need as "oversupply".
This is almost a cliche in reporting on China that seems to reflect a serious blindpsot in western media and/or business attitudes.
You can find plenty of articles complaining about "overcapacity" of battery factories in China even as they double in capacity and output each year.
Chinese electricity generation went from 4,000 TWh (the same as the US) in 2010 to double that in 2020. The US was basically the same after 10 years.
So a 100% "oversupply" in 2010 would be a zero percent oversupply within a decade given China's growth.
Most telling to me is that decarbonisation and electrification of transport and heating has long been known to require a doubling(!) of electricity production for developed nations (and a similar increase in developing nations where it gets hidden by other growth).
Apparently the US simply never had a plan to achieve that, and amazingly it still isn't part of the conversation around AI power. Instead they're just claiming the best parts of the existing power systems and passing the costs onto local consumers.
roenxi · 50m ago
The simplest explanation is this is political language. People in politics use something close to doublespeak with they have two words for the same act, one good and one bad (terrorist/freedom fighter for example). The word used is chosen based on whether they think the situation is good or bad for their personal interests.
So in this case the pair is something like oversupply/abundance. Same thing, but one word for when it favours the speaker and one when it doesn't. I think he just means the Chinese are willing to build whatever if it makes commercial sense.
dluan · 12m ago
I'm old enough to have seen this shift happen first hand. I remember the language being used in the early 90s when US-China relations were great, with evening news clips of smiling Bill Clinton and Jiang Zemin yukking it up as hundreds of thousands of jobs were offshored to China to American politicians and industrialists delight.
energy123 · 24m ago
You either want a plan like China or an absence of planning like Texas. Either help like China or get out of the way like Texas. Two places that can actually build energy. Don't be like California where the government doesn't help while also getting in the way.
tw04 · 13m ago
The same Texas that has statewide power outages every time it gets below freezing (despite knowing for 25+ years it’s a problem) because of their lack of regulation and central planning?
Let’s not be anything like Texas.
infecto · 1m ago
I would not entirely dismiss the way the power market works in Texas. I have not disagreement the 2021 storm should never have happened. At the same time though, I don’t believe other energy markets work very well either. I would prefer a more Texas like approach but with some thoughtfulness around capacity instead of just generation.
huhkerrf · 9m ago
This just shows how you know only the talking points. The power outages are not due to lack of central planning, it's very explicitly the reverse. If Texas were hooked up to the rest of the country, those outages would not be a thing. It's the purposeful regulation that has caused those problems.
corimaith · 13m ago
There's nothing "obvious" in hindsight about the explosion in LLMs in 2023 and thus the increased energy demand, and the China certainly wasn't building for that.
It very much was overcapacity as a way to keep the construction and manufacturing employed even when most profitable opportunities have been realized. Of course, the long cost of that is involution and lack of nicer jobs as capital is malinvested into diminishing returns. The ironic thing is that idea of overcapacity itself is acknowledged by the CCP in their calls to end price wars and involution
I do think there’s is a very interesting dynamic in this meta argument; over the past 5 years or so, the “debunkers” have taken issue with “whistleblowers” arguments towards first zero covid, then local government debt, and now overcapacity and lack of consumer demand and “debunked” these as all being not an issue, only for the central government to turn around and end Zero Covid, rein in LGFV lending, and now the current crackdown on “disorderly competition” and mass dispersal of consumption vouchers. English Pro-China commentators don't appear to be well aligned with the actual views in China!
rafaelmn · 5m ago
I have a feeling that this kind of efficiency/capacity analysis is similar to that joke about economist designing a human, instead of having two kidneys you have 5 people sharing one. I am a pro market guy for a lot of things, but what happens when you let the market operate something like basic infrastructure is everyone is shipping their shit/sewage in trucks and running a diesel power generator in their back yard.
plastic-enjoyer · 54m ago
> Apparently the US simply never had a plan to achieve that, and amazingly it still isn't part of the conversation around AI power. Instead they're just claiming the best parts of the existing power systems and passing the costs onto local consumers.
I wonder if this is more of a cultural thing, meaning Western cultures being more aligned to short-term gains instead of long-term gains. I mean, look at the Dujiangyan irrigation system that was build 2500 years ago and is still maintained until today. This isn't something the Western world would even consider.
Spooky23 · 45m ago
The structure of the United States government is a compromise balancing large vs. small states interests and slavery.
The core defect in the design is the Senate and the way states were admitted. We have a territory/colony with limited political rights that has a population greater than the bottom four states.
Those small states exert enormous influence and essentially ensure a weird conservative dynamic that anchors a lot of social issues.
Not because of the politics of the day - because resource extraction is always conservative by nature as the core aspect of the business is minimizing overhead cost. Agriculture flipped into a purely extractive business as people have been removed from it.
richwater · 19m ago
> Those small states exert enormous influence
It's called the United States for a reason, not the United People. What you're obviously desiring would result in a series of vassal states (large cites governing themselves) with most of the country (rural) acting as feudal serfs.
snowwrestler · 7m ago
I think it’s likely you are just not familiar with examples of U.S. long-term planning if you’re citing water movement as an area where China is doing better.
dkiebd · 45m ago
Sanitation and road infrastructure built during the Roman Empire is still in use today.
el_jay · 28m ago
While there is certainly an argument to be made that many contemporary “Western” Pseudo-Christian Superempire nations face a crisis of short-termism, there are also ancient bits of “Western” infrastructure like the Roman aqueducts still in use today - off the top of my head, the Aqua Virgo which supplies Rome’s Trevi Fountain, dated either 19BC or 19AD, I forget; Spain’s Segovia Aqueduct from the first century AD; and the Pont du Gard in Nîmes, from the same period.
Not quite as old, or at the scale of the Dujiangyan system, but still evidence that the “Western” culture did once build for long term. Less ancient, but more indicative, are the European cathedrals built by multiple generations over a century.
grumpy-de-sre · 15m ago
For an even closer example, the US interstate system was a monumental long term focused project.
plastic-enjoyer · 27m ago
Good point!
BlarfMcFlarf · 32m ago
In the USA, any non-private government investment is considered to be foolish and doomed at best, and an existential threat to business at worst. The best we can do is “public-private partnership” where all the profits get absorbed by middle men, preventing virtuous cycles and still leaving a cap on risk and future planning.
roenxi · 42m ago
The West have been executing a long-range plan for 30 years on this one, the lack of power plants is intentional. There have been any number of roadblocks and people working hard to prevent the West doing specifically what the Chinese have done with the goal of maintaining the high air quality that Western countries tend to enjoy.
If anything the West's culture has been doing more long term planning. It is quite difficult to force an economy not to produce something.
pu_pe · 20m ago
> [China's] reserve margin has never dipped below 80%–100% nationwide, meaning it has consistently maintained at least twice the capacity it needs (...). That level of cushion is unthinkable in the United States, where regional grids typically operate with a 15% reserve margin and sometimes less
That's a huge difference!
This also means that in a scenario where credible alternatives to Nvidia and AMD emerge in mainland China, the Chinese will win even if their chips are far less efficient.
softwaredoug · 4m ago
AI and data centers may be the forcing function for the US to build green energy to improve grid capacity. Lately almost all new energy capacity is green energy[1]. With batteries becoming better and better, the AI revolution could turn into the green energy revolution in the US.
Didn't people say this about crypto as well, like, a decade ago? Did anything come of that?
I find it endlessly fascinating that the US tech industry keeps developing new ways to consume absurd amounts of energy (even within the context of a government that still nominally has an Energy Star initiative) but still somehow thinks that power generation is someone else's problem and barely even takes a stake in it.
Google did some stuff a while back, locating data centres with power generation in mind, but do any of the main AI providers (putting aside xAI, which has its blurred-edge connection to Tesla) actually have holdings in power generation?
snowwrestler · 4m ago
AI cannot succeed financially if it requires as much power over the long term as it does now. The answer to the power supply challenge will come primarily from gains in efficiency because that is the only approach that will reliably increase margins.
shrubble · 34s ago
It seems clear that "buy a lot of Nvidia GPUs" is not the only way to go: Google, Microsoft, Groq.com (not Elon Musk's Grok), xAI and possibly others are making and using their own hardware believed to be more power-efficient for training and/or inference.
elric · 40m ago
Are there any plans for significant investments in the US grid(s)? IIRC the entire US doesn't even have a single interconnected grid, with Texas having their own for some reason.
European grids aren't that much better either, loads of investments needed in order to connect more renewables. Some areas already can't handle the load from solar panels/electric vehicles. Everyone seems to know that this is both costly and necessary, but not much seems to be happening. Maybe these things simply take time?
boricj · 24m ago
> European grids aren't that much better either, loads of investments needed in order to connect more renewables.
On one hand, Spain and Portugal recently suffered a complete blackout. On the other hand, instead of cascading the blackout France shrugged it off.
The last time there was a country-wide blackout in France was back in the seventies. I'm not saying our grid infrastructure is perfect, but here we're not worried about losing electricity for an entire week whenever there's a winter storm.
And we need capable governments and EU institutions to fix that instead of doing stupid stuff like organizing conferences on quantum computing.
tiledjinn · 14m ago
texas has its own so that it doesn't need to meet the regulations of the others
htrp · 33m ago
Texas has its own grid so that is not subject to federal regulation. blame ercot
petcat · 22m ago
Texas also produces the 2nd most renewable energy in the country (wind by far + solar) behind California. That achievement was coordinated by ERCOT.
Texas's renewable energy buildout was entirely due to state-level policy and economics, not federal mandates, which have sorely lagged in other states.
ckemere · 15m ago
Weren’t there Federal subsidies for wind? There certainly were/are philanthropic support (customers paying extra for “wind energy”). Unclear what role ERCOT played in these two factors. (Though in the current climate they might have tried to block them.)
petcat · 11m ago
Utility-scale wind and solar farmers in Texas receive the same federal tax credits for renewable energy production as everyone else in the country does.
idiotsecant · 9m ago
The US has several dc interties between grid sections. This is a good thing. Texas is a political island, not a good thing.
mschuster91 · 34m ago
> with Texas having their own for some reason.
That reason is that Texas wants to avoid federal regulation [1] - regulation that would have prevented the large ass blackout a few years ago in the winter. But hey, 702 deaths [2], a small price to pay for freedom of regulations!
> Everyone seems to know that this is both costly and necessary, but not much seems to be happening. Maybe these things simply take time?
They take money and political willpower. Both are in short supply - electricity rates here in Europe are already high (and rates in the US very low), so utilities try to avoid pissing off consumers even more, and political willpower for billions of dollars of investment isn't there either as thanks to decades of austerity and trickle-down ideology there is no tax base to pay for it any more.
> regulation that would have prevented the large ass blackout a few years ago in the winter.
They also produce the most renewable power in the country. If you account for externalities prevented by this (fossil fuel induced damage and deaths), who is looking good now?
It got so cold that the oil in the wind turbines froze. If Texas was connected to the rest of the country it would be subject to federal regulations that require winterization and even if the wind turbines weren't frozen it would have been able to import power from other places that weren't frozen over.
petcat · 2m ago
Frozen wind turbines was a microscopic part of the problem compared to almost half of the fossil fuel natural gas plants being offline due to severe cold and freeze.
DiscourseFan · 33m ago
Never a bad time to have friends in China.
mawadev · 32m ago
I think the leaders of western countries know something that we don't know.
Maybe how the economic impact of AI is not as big as advertised for 3 years or that electric cars still cannot do what is needed on a bigger scale in terms of distance and transport.
Or maybe they are going to pull fusion out of their sleeves rendering the existing infrastructure almost obsolete?
AI literally came out of the US at this scale and they are the reason we have this conversation now, you can twist any narrative and make it seem like one country is smarter or better if you want to present it as that.
But does anyone even keep track of effectivity of resource utilization?
Maybe all of these avenues are not worth the effort to begin with?
goda90 · 29m ago
The much simpler explanation is that our leaders are focused solely on short term gains. They'll grift their way to them gladly, but investing in infrastructure that'll take years to build and won't be useful until they are gone is not interesting to them.
plastic-enjoyer · 19m ago
> They'll grift their way to them gladly, but investing in infrastructure that'll take years to build and won't be useful until they are gone is not interesting to them.
I think this may have something to do with the professionalisation of politics, or the existence of career politicians. If you want to climb up the ladder in politics, working on short-term goals is probably the best way to do this. Infrastructure projects are high-risk, low-reward. Infrastructure projects may take a long time, may be reversed/aborted by the next government, may piss off potential voters, may require to fight off NIMBYs, or aren't noticed due to the preparedness paradox.
lotsofpulp · 15m ago
Even more simple is that voters are focused solely on short term gains, so investing in infrastructure that’l take years to build and won’t be useful until they are gone is not interesting to them.
The proof is voters keep rewarding the party that has only passed tax cuts for the last 30 years. And started an unnecessary foreign war.
The aging population histograms of pretty much all democracies don’t bode well for democracy.
seydor · 7m ago
I thought it was over because it hit a ceiling
moomin · 32m ago
This entire article is framed as if China and America’s approaches to power provision are the only ones possible. The truth is, America is pretty much the only Western country that regularly suffers brownouts. European countries’ (including the U.K.) energy policies may leave much to be desired but they all succeed in keeping the lights on.
placardloop · 15m ago
Nearly 15% of Irelands population was without power for multiple days earlier this year due to a storm. And the Iberian peninsula blackout that happened just in April was one of the biggest power blackouts in the history of the world. And those are just the ones off the top of my head.
bombcar · 26m ago
Didn’t Spain or Portugal famously not keep the lights on just recently?
For all the complaints and kudos, in general the major events seem similar, at least in number.
spicyusername · 26m ago
I don't think Texas is representative of entire the United States.
pfdietz · 28m ago
I'd like to see actual data backing up those statements.
micromacrofoot · 27m ago
it's amazing how little americans care for their shared infrastructure, there's always talk about the world's balance of power changing... but even through the propaganda it's hard to see how it's not a certainty
isoprophlex · 25m ago
We are fucking ourselves over with our unbridled neoliberalist, hypercapitalist "lmao the market will save us" approach to doing literally everything based only on short term gains: from politics to economics to infrastructure to education. As this article is a fine example of.
grumpy-de-sre · 4m ago
Yeh I think this is less of a story about Chinese exceptionalism and more a story of structural issues in the west (I will always admire the Chinese technocrats but lets not get ahead of ourselves).
Fossil fuel barons and vested interests have sabotaged the energy transition at every opportunity possible. They've spent billions on it, just look at today's UN conference on plastic waste falling apart.
And then there is the NIMBYs who are seemingly allergic to electricity pylons. These folks don't deserve one tenth of the attention that they receive. Treating housing as an investment/retirement fund was a mistake.
Hopefully this grows into a wake up call (I'm looking forward to watching the terminal decline of the oil industry in the 2030s).
jmclnx · 22m ago
So a case of "socialism" working vs US.
So instead of encouraging roof top solar and wind, the US is now doubling down on fossil fuels.
That means individuals can no longer afford to go with solar these days. Plus in areas that people went with solar, some laws were put in place to force them to still pay utilities even though they supply back to the grid.
This is almost a cliche in reporting on China that seems to reflect a serious blindpsot in western media and/or business attitudes.
You can find plenty of articles complaining about "overcapacity" of battery factories in China even as they double in capacity and output each year.
Chinese electricity generation went from 4,000 TWh (the same as the US) in 2010 to double that in 2020. The US was basically the same after 10 years.
So a 100% "oversupply" in 2010 would be a zero percent oversupply within a decade given China's growth.
Most telling to me is that decarbonisation and electrification of transport and heating has long been known to require a doubling(!) of electricity production for developed nations (and a similar increase in developing nations where it gets hidden by other growth).
Apparently the US simply never had a plan to achieve that, and amazingly it still isn't part of the conversation around AI power. Instead they're just claiming the best parts of the existing power systems and passing the costs onto local consumers.
So in this case the pair is something like oversupply/abundance. Same thing, but one word for when it favours the speaker and one when it doesn't. I think he just means the Chinese are willing to build whatever if it makes commercial sense.
Let’s not be anything like Texas.
It very much was overcapacity as a way to keep the construction and manufacturing employed even when most profitable opportunities have been realized. Of course, the long cost of that is involution and lack of nicer jobs as capital is malinvested into diminishing returns. The ironic thing is that idea of overcapacity itself is acknowledged by the CCP in their calls to end price wars and involution
I do think there’s is a very interesting dynamic in this meta argument; over the past 5 years or so, the “debunkers” have taken issue with “whistleblowers” arguments towards first zero covid, then local government debt, and now overcapacity and lack of consumer demand and “debunked” these as all being not an issue, only for the central government to turn around and end Zero Covid, rein in LGFV lending, and now the current crackdown on “disorderly competition” and mass dispersal of consumption vouchers. English Pro-China commentators don't appear to be well aligned with the actual views in China!
I wonder if this is more of a cultural thing, meaning Western cultures being more aligned to short-term gains instead of long-term gains. I mean, look at the Dujiangyan irrigation system that was build 2500 years ago and is still maintained until today. This isn't something the Western world would even consider.
The core defect in the design is the Senate and the way states were admitted. We have a territory/colony with limited political rights that has a population greater than the bottom four states.
Those small states exert enormous influence and essentially ensure a weird conservative dynamic that anchors a lot of social issues.
Not because of the politics of the day - because resource extraction is always conservative by nature as the core aspect of the business is minimizing overhead cost. Agriculture flipped into a purely extractive business as people have been removed from it.
It's called the United States for a reason, not the United People. What you're obviously desiring would result in a series of vassal states (large cites governing themselves) with most of the country (rural) acting as feudal serfs.
Not quite as old, or at the scale of the Dujiangyan system, but still evidence that the “Western” culture did once build for long term. Less ancient, but more indicative, are the European cathedrals built by multiple generations over a century.
If anything the West's culture has been doing more long term planning. It is quite difficult to force an economy not to produce something.
That's a huge difference!
This also means that in a scenario where credible alternatives to Nvidia and AMD emerge in mainland China, the Chinese will win even if their chips are far less efficient.
1 - https://cleanpower.org/news/market-report-2024-snapshot/?utm...
I find it endlessly fascinating that the US tech industry keeps developing new ways to consume absurd amounts of energy (even within the context of a government that still nominally has an Energy Star initiative) but still somehow thinks that power generation is someone else's problem and barely even takes a stake in it.
Google did some stuff a while back, locating data centres with power generation in mind, but do any of the main AI providers (putting aside xAI, which has its blurred-edge connection to Tesla) actually have holdings in power generation?
European grids aren't that much better either, loads of investments needed in order to connect more renewables. Some areas already can't handle the load from solar panels/electric vehicles. Everyone seems to know that this is both costly and necessary, but not much seems to be happening. Maybe these things simply take time?
On one hand, Spain and Portugal recently suffered a complete blackout. On the other hand, instead of cascading the blackout France shrugged it off.
The last time there was a country-wide blackout in France was back in the seventies. I'm not saying our grid infrastructure is perfect, but here we're not worried about losing electricity for an entire week whenever there's a winter storm.
And we need capable governments and EU institutions to fix that instead of doing stupid stuff like organizing conferences on quantum computing.
Texas's renewable energy buildout was entirely due to state-level policy and economics, not federal mandates, which have sorely lagged in other states.
That reason is that Texas wants to avoid federal regulation [1] - regulation that would have prevented the large ass blackout a few years ago in the winter. But hey, 702 deaths [2], a small price to pay for freedom of regulations!
> Everyone seems to know that this is both costly and necessary, but not much seems to be happening. Maybe these things simply take time?
They take money and political willpower. Both are in short supply - electricity rates here in Europe are already high (and rates in the US very low), so utilities try to avoid pissing off consumers even more, and political willpower for billions of dollars of investment isn't there either as thanks to decades of austerity and trickle-down ideology there is no tax base to pay for it any more.
[1] https://en.wikipedia.org/wiki/Texas_Interconnection
[1] https://en.wikipedia.org/wiki/2021_Texas_power_crisis
They also produce the most renewable power in the country. If you account for externalities prevented by this (fossil fuel induced damage and deaths), who is looking good now?
https://en.wikipedia.org/wiki/List_of_U.S._states_by_renewab...
AI literally came out of the US at this scale and they are the reason we have this conversation now, you can twist any narrative and make it seem like one country is smarter or better if you want to present it as that.
But does anyone even keep track of effectivity of resource utilization?
Maybe all of these avenues are not worth the effort to begin with?
I think this may have something to do with the professionalisation of politics, or the existence of career politicians. If you want to climb up the ladder in politics, working on short-term goals is probably the best way to do this. Infrastructure projects are high-risk, low-reward. Infrastructure projects may take a long time, may be reversed/aborted by the next government, may piss off potential voters, may require to fight off NIMBYs, or aren't noticed due to the preparedness paradox.
The proof is voters keep rewarding the party that has only passed tax cuts for the last 30 years. And started an unnecessary foreign war.
The aging population histograms of pretty much all democracies don’t bode well for democracy.
For all the complaints and kudos, in general the major events seem similar, at least in number.
Fossil fuel barons and vested interests have sabotaged the energy transition at every opportunity possible. They've spent billions on it, just look at today's UN conference on plastic waste falling apart.
And then there is the NIMBYs who are seemingly allergic to electricity pylons. These folks don't deserve one tenth of the attention that they receive. Treating housing as an investment/retirement fund was a mistake.
Hopefully this grows into a wake up call (I'm looking forward to watching the terminal decline of the oil industry in the 2030s).
So instead of encouraging roof top solar and wind, the US is now doubling down on fossil fuels.
That means individuals can no longer afford to go with solar these days. Plus in areas that people went with solar, some laws were put in place to force them to still pay utilities even though they supply back to the grid.
I guess this is "winning".