China Becomes “Clean Energy Powerhouse”
By Joe Mullich
China, determined to be on the forefront of green technology, “is emerging as the world’s clean energy powerhouse,” according to a recent study from The Pew Charitable Trusts, an independent non-profit organization based in Washington, DC
For the first time ever, China topped all nations last year in investments in low-carbon energy like wind and solar power. Over the past five years, environmentally friendly energy finance and investments in China grew from $2.5 billion to $34.6 billion, almost double the $18.6 billion in investments attracted by the United States.
And that is only one part of the country’s growing emphasis on environmentally friendly products and practices. Along with ambitious targets for wind, biomass and solar energy, China aims to spend 34 percent of its $586 billion stimulus package on green projects.
“With the Chinese government also settingtargets, it is becoming evident to mainland Chinese companies that the green movement is something to be taken really seriously and will help them keep up with competition not only domestically within China but also when it competes internationally,” says Janice Lao, the environmental manager for Cathay Pacific Airways, which is headquartered in Hong Kong.
Tom Lyon, director of the University of Michigan’s Erb Institute for Global Sustainable Enterprise, notes that “green is everywhere in China.” Environmentally friendly practices were a major theme of the Shanghai World Expo. The attention-getting pavilions competed to outdo one another in their use of eco-friendly building materials like “transparent cement” that reduce the need for artificial light.
In addition, China now leads the world in manufacturing solar cells for solar panels and installing new wind turbines. With green becoming a major business opportunity, the Annual Summit of China Green Companies 2010, co-organized this year by China Entrepreneur Club and the Chengdu municipal government, has seen the number of applicants for its green awards triple over the past three years. At the recent summit, 36 companies were honored for their achievements in “Achieving Sustainable Competitiveness by Fostering Benign Ecosystem.”
Lyon, who was a speaker at the summit, believes it was significant that the first session was on “green values,” where each participant was given 10 minutes to expound on the topic. To Lyon, that emphasis indicates the growing green movement is helping the Chinese populace find new values in a nation that is changing rapidly from “the old imperial” ways. Lyon says, “The environment is something that resonates as bigger than oneself and can serve to bring people together.”
The Pew study noted “nations such as China, Brazil, Germany and Spain that have adopted national renewable energy and energy efficiency standards, feed-in tariffs, carbon reduction targets and/or financial incentives for investment and production are assuming leadership positions in the clean energy sector.” That is radiating through China in many ways, from manufacturing practices to philanthropic endeavors.
In 2007, for example, Cathay Pacific and its sister airline, Dragonair, launched a program in China called Flygreener that gives passengers the opportunity to offset the carbon emissions attributable to their journey and includes offsetting all business travel taken by its own staff. The program funds efforts that reduce CO2 emissions, such as wind power or mini hydro, which helps absorb CO2 from the atmosphere.
“I think the Chinese public, as well as the international clients buying from China, are pushingcompanies to really think about their environmental impacts,” Lao says. “While there is still definitely a lot of room for growth within the China market, it is nevertheless great to see how fast they are picking up on the environmental agenda.”
She notes that, as in the United States, companies operating in China can take simple steps to protect the environment through their conservation of paper or electricity. “While ad-hoc environmental projects are good, it is important to explain how these projects help environmental issues,” Lao says. “I think the major difference in China is that education and awareness is also extremely important in launching your green initiatives.”
Carbon offsetting, for example, is a relatively new idea in China and was even more so when the Cathay Pacific program was launched three years ago. The airline had to start by educating its staff and developing brochures so they could describe the initiative in as simple a manner as possible. “Once your customers and employeesunderstand and are connected to the issue, then they become engaged with it,” she says.
Communicating “green” ideas can require clever thinking in a country where such practices are just emerging and Western-style advertising is not common. American Clay Enterprises, a New Mexico company, found this out when it began selling its all-naturalclay wall plaster finish in China. The company’s earth-plaster finish lays claim to having the lowest carbon footprint per pound of any commercially produced wall finish.The issue was how to prove that. “In a country where disclosure of information is held more closely, there is an inherent distrust of claims,” says American Clay co-founder Croft Elsaesser.
At a China trade show, he had difficulty explaining what made his product more environmentally friendly until he gave a demonstration applying the plaster–and then afterwards dumped the remnants into a tank filled with goldfish. “When people saw the fish were all right, they understood our plaster didn’t have any hazardous components or additives,” he says.
In a fast-changing country, Elsaesser says one of the greatest challenges is to identify the “green middlemen”–the architects and designers who select the green building materials. “It’s a slower developing market than in the United States,” Elsaesser says. “But you can’t overlook the potential of a billion people.”
The Pew study called green energy research one of the biggest economic – and environmental opportunities of the 21st century. Clean energy investments are seen as a key step for China–or any nation–to renew its manufacturing base, as well as create export opportunities, jobs and businesses. With China looking to become even more engaged in world commerce, experts say the green emphasis is likely to become stronger.
Joe Mullich writes about business, technology and other topics.
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