China, the world’s biggest greenhouse-gas polluter, plans to become one of the world’s leaders in green business.

Even as the country builds a coal-fired electric power plant every week and is as relentless as the U.S. in its search for oil throughout the world, it is also taking serious steps to be a major player in a greener, cleaner future economy. It’s a matter of geopolitics as well as good business.

“The Chinese government…has figured out that this is the way to stand on the stage with the United States on equal footing,” said Rocky Lee, based in Beijing as head of international law firm DLA Piper’s Asia private equity and venture practice and the firm's Asia Cleantech Practice. “Green and clean is the way to do it.”

During a speech to the U.N. General Assembly last month, Chinese President Hu Jintao promised to plant 150,000 square miles of trees, slow the growth of emissions, and get 15 percent of China’s energy from renewable energy by 2020—a more ambitious goal than any yet stated by the Americans or Europeans.

As a practical matter, that means massive government and private industry investments in renewable energy, and there are signs that China is making such investments.

In 2008, according to Frost & Sullivan analyst Linda Yan, investment in renewable energy in China climbed 18 percent to $15.8 billion, compared to global growth of 5 percent.

China has become the world’s biggest solar-panel manufacturer, and it’s done so almost overnight.

“I have to say, I’ve been surprised at how fast they’ve been able to go from insignificant to leading,” said Mike Hall, CEO of solar installer Borrego Solar. “They’ve been incredibly aggressive in their growth plans. I think that the government has decided they want to be leaders in that space and they have an incredible amount of resources they can put in that space.”

China now manufactures about 40 percent of the world’s solar panels, and 90 percent of them are exported primarily to Europe and the United States, said Saifur Rahman, director of the Advanced Research Institute at Virginia Tech and an IEEE Fellow.

But there are signs the nation will start using some of that solar power at home, and that U.S. companies with expertise in installation could benefit. The country is working with a U.S. firm, First Solar, to create the world’s largest solar farm, a two-gigawatt installation in Ordos, a city in Inner Mongolia.

Mark Pinto, head of Applied Materials' solar manufacturing unit, said in an interview with the Wall Street Journal that China would move past Germany to become the world's largest user of solar panels.

Other areas in which U.S. companies could benefit as China goes green are wind generation and biofuels, said John Urbanchuk, a director at LECG, a consulting firm. The U.S. is especially strong in development of biofuels, as U.S. companies try to develop the next generation of fuel from such materials as algae.

“We’re looking at quite a robust marketplace for renewable fuel and renewable-fuel technology,” Urbanchuk said. “I don’t think we’ve seen the implications of that yet in the marketplace.”

China’s change is a matter of necessity, said Rahman. China derives 80 percent of its electricity from coal and consumes about half a kilowatt per person per day. As the economy grows, that consumption will rise. U.S. residents consume about 3 kilowatts per person. If China doubles its capacity from 750,000 megawatts to 1.5 million megawatts by 2020, they won’t have the raw material to meet that need, regardless of the pollution it would cause.

“They cannot sustain the heavy dependence on coal,” Rahman said. “They are saying they have to make plans for both wind and solar. Between hydro, wind, and solar, they can achieve what they’re talking about.”