DOE SECRETARY CHU AND CHINA SCIENCE MINISTER CO-CHAIR FIRST

UNCLAS SECTION 01 OF 03 BEIJING 003180 STATE FOR EAP/CM-HABJAN, EAP/CM, EAP/PD-STOLTZ STATE FOR OES DAS MIOTKE, OES/EGC, OES/ENV, AND OES/PCI STATE FOR S/SECC-STERN, S/P-GREEN, EEB, AND ECA STATE PASS TO CEQ SUTLEY USDOE FOR INTERNATIONAL USDOC FOR MAC AND MAS USDOC PASS USPTO FOR WU EPA FOR INTERNATIONAL/MKASMAN/GIANNINI-SPOHN NSC FOR LOI SENSITIVE SIPDIS E.O. 12958: N/A TAGS: OVIP PREL PGOV ECON PARM MARR SENV ENRG KGHG CH SUBJECT: DOE SECRETARY CHU AND CHINA SCIENCE MINISTER CO-CHAIR FIRST JOINT CLEAN ENERGY CENTER STEERING COMMITTEE MEETING (U) Sensitive but unclassified. Please handle accordingly. ¶1. (SBU) On the eve of the U.S. President's first visit to Beijing, Department of Energy Secretary Steven Chu, China's Minister of Science and Technology WAN Gang, and National Energy Administration (NEA) Deputy Administrator LIU Qi (acting for Administrator Zhang Guobao) convened the first steering committee meeting of the new U.S.-China Clean Energy Research Center (CERC). All three committed to increasing CERC's funding from the previously announced amount of USD 15 million to a total of USD 150 million over five years and agreed that future steering committee meetings should be held at the Secretary-Minister level. Minister Wan proposed that an executive secretariat be created to steer the direction of CERC research and provide high-level guidance. Secretary Chu said that the DOE will consider the naming of an Executive Secretariat. National Energy Administration (NEA) Deputy Administrator LIU Qi, however, provided a somewhat different view of NEA's vision for the CERC than Minister WAN. Liu said in the interest of streamlining and less bureaucracy, NEA preferred not to establish an executive secretariat. Liu also suggested that the CERC focus on clean energy standards and greater collaboration on nuclear energy. [NOTE: NEA is one of three key partners on the Chinese side involved in the CERC, the Ministry of Science and Technology (MOST) and the Chinese Academy of Sciences (CAS) are the other key players. END NOTE.] END SUMMARY DOE and MOST Concur on Direction of Clean Energy Center -------------- -------------- ¶2. (SBU) Secretary Chu began the meeting by noting that the United States is upping its CERC funding commitment from USD 7 million to USD 75 million over a 5-year period. Funding will come from both public and private sources, and CERC participants will include business, academia, and government. DOE will solicit public comments as they assemble plans for projects in three key areas: 
energy efficient buildings, clean coal and carbon capture and sequestration (CCS),and electric vehicles. Secretary Chu also proposed the establishment of an advisory committee composed of six representatives from each side. ¶3. (SBU) Noting that "remarkable progress" had been made with respect to the CERC, Minister Wan proposed that the steering committee be chaired by the DOE Secretary, the MOST Minister and the NEA Administrator and should meet annually, alternating locations between the U.S. and China. Wan also suggested establishing an executive secretariat composed of director generals (DGs) and deputy director generals (DDGs) from NEA, CAS, and the Ministry of Housing, Urban, and Rural Development (MOHURD) to manage the relationship, and named CAO Jianing, MOST's DG for International Cooperation, as Executive Secretary for the Chinese side. Below the Executive Secretariat, Wan agreed on the creation of a joint advisory panel, and suggested it be composed of experts from enterprises, universities, and research institutes and selected by the executive BEIJING 00003180 002 OF 003 secretariat. Finally, Wan said that China will match the U.S. effort to increase funding and committed USD 75 million to fund CERC projects in the three areas that Secretary Chu noted. Wan said that DOE and MOST have already agreed on funding mechanisms and both sides should jointly develop plans for funding three projects (one in each key area) every year. ¶4. (SBU) Secretary Chu agreed with the management approach that is outlined in the protocol, which calls for a principal-level steering committee and a joint advisory panel with six members on each side. With respect to adding an executive secretariat, Chu said that DOE will give it full consideration and work to name the advisory members soon. Experts in the three key areas will be identified for the joint advisory board on the U.S. side, but the Secretary cautioned that the two sides must have close scientist-to-scientist exchanges and collaboration to avoid heading in independent research directions. Having highly focused research projects would also help avoid this situation. He also suggested that some of the advisory panel members be from industry to provide the industry perspective on CERC's R&D effort. NEA Has a Somewhat Different View of Cooperation -------------- --- ¶5. (SBU) Noting that his boss NEA Administrator ZHANG Guobao was out of the country, NEA Deputy Administrator LIU Qi said he was relaying Zhang's ideas on the structure of the CERC. According to Liu, NEA is concerned that too much bureaucracy will slow the pace of CERC R&D; therefore, it is NEA's position that an executive secretariat should not be established. Liu suggested that those carrying out CERC projects work directly with their respective counterparts rather than having an executive secretariat steer the direction of research. Although NEA concurred with having clean coal and CCS as a primary focus of CERC, Liu's priorities for other areas of research also seemed to deviate from those of MOST. Liu suggested that previous discussions on setting renewable energy standards, which took place during the U.S.-China Energy Policy Dialogue in October, should be folded in to the CERC scope and said that NEA would be sending a delegation to the U.S. soon to discuss this issue. Liu, noting intense national policy focus on nuclear power, also suggested greater collaboration on nuclear energy. ¶6. (SBU) COMMENT: NEA Deputy Administrator Liu's proposals on how the CERC should be structured were remarkably divergent from those of MOST Minister Wan and it is somewhat surprising that such differing views were discussed so openly with the USG during the steering committee meeting. Moreover, NEA's desire to avoid establishing an executive secretariat chaired by MOST suggests that there is an ongoing bureaucratic scuffle between NEA and MOST for the lead role in what is likely considered a very prestigious bilateral cooperative mechanism. Moreover, a tussle among key Chinese bureaucracies could have the potential to impede efficient CERC collaboration. END COMMENT. BEIJING 00003180 003 OF 003 ¶7. (U) This cable was cleared by the Secretary Chu Delegation. HUNTSMAN