Cleantech

It's one of those clear, blue-sky days in Beijing -- one of the very few I've seen during the last two weeks, where a grey dusty hue has covered the landscape (sandstorm or not). I take care to stay indoors as much as possible, and when riding in a taxi, ask the driver to roll up the windows and turn on the air conditioner. Otherwise, I risk tearing eyes, runny nose and a hacking cough -- effects caused by the air pollution.

But count on the Chinese government to continue its clean-up of the air as the Beijing Olympics comes closer. Things have definitely improved since 2002, when I started coming to China regularly. And much of this progress has to do with efforts by the government and private sector to invest in clean technology. Joining in are venture capital investors such as the high-profile Kleiner Perkins and Sequoia Capital as well as a handful of Chinese funds that have earmarked cleantech sectors as a high priority.

Certainly, much financing is needed. The Chinese government's 11th, five-year economic plan pinpoints that $867 billion is needed for the massive clean-up. Yet only $382 billion has been invested, according to managing director Ka Keung Chan of London-based Climate Change Capital, who heads a team in Beijing looking for emerging cleantech companies to finance.

The impetus is on entrepreneurs and investors to hurry up and find solutions to clean up Planet Earth. Note that the Chinese government has an ambitious plan to grow the economy four times by 2015 but only double energy consumption. That will take a great leap forward, as currently the majority of energy in China is generated from coal.

Worldwide, cleantech has emerged as the second-largest venture capital category. Encouragingly too, talent has crossed over from information technology to "envirotech," points out James Mahoney, China country director for Cleantech Group in Beijing. Some 40% of the venture money is being poured into the U.S. The bad news is that China only gets a 4% portion of that capital. Clearly, we need to push the accelerator in China.

China's Suntech Power, one of the world's largest solar power producers, is one of the major stars of the coutry's cleantech revolution. The firm's chairman and CEO Shi Zhengrong, speaking recently at an Asia Society conference in Tianjin, said he puts about 5% of the firm's profits to fund "risk-taking activities" that can lead to breakthroughs in research and development. He predicts that by 2050, 30% of the cars on the roads will be solar-powered, up to 75% by the end of the century. But education is needed. That's why Shi is eager to sponsor a tour of Al Gore and his documentary in China. There's a precedent for such tours. At the Swissotel in Beijing where I stayed a few nights, there parked in the lobby one morning was a Swiss-invented solar-powered car (complete with a large solar panel wagon) that's been making a worldwide road trip to raise awareness of protecting the planet.

As the countdown begins to the Olympics this August 8, 2008, the Chinese government is keeping a close tally of its goal to make the games the "Green Olympics." One of the achievements it's been tracking is the number of these so-called "blue-sky' days in Beijing. Last year saw 240 clear days, a steady progression each year since measurements began in 2000, when only 177 days entered the blue zone. How? Some 198 industrial centers were relocated or closed, a 50% decrease in steel production within the city limits was cut by 50%, and vehicle emission standards were more strictly enforced. I have this data courtesy of Xiaoxuan Yu, director of construction and environment for the Olympics, who spoke at the AVCJ Private Equity & Venture Forum in Beijing that I attended. On his report card were also these facts: natural gas consumption has nearly quadrupled and capacity for waste water treatment has almost doubled.

More is to come. Yu called attention to a map of a draft plan to create a buffer zone of urban green areas surrounding Beijing. And he said park-like areas now make up half of Beijing, though that's hard to imagine when traveling along the capital city's ring of roads lined with skyscrapers.

I could not help but note the pride in his voice as he compared China's progress with the track record of its western counterparts. As one example, he pointed out that Beijing's air quality is comparable to Los Angeles about two decades ago. I remember the ring of smog around LA, and it's easy to nod along in agreement with him.

Let the Clean Industrial Revolution begin in China!

Comments

[avicenna]

I have done some research in environmental policy and progress in various regions and the challenges put before second world economies - such as China and India who are on the cusp of taking over most industrialized nations in regards to economic development and progress - and I was quite pleasantly surprised how progressive China has been in regards to curbing its ecological footprint and investing in sustainability. Their policies really put America to shame - their gas emission limits for automobiles are far stricter then gas guzzlers in the US, and China recently inked a deal with an American company that combines waste water treatment with energy production - end product being clean water plus free energy as a by product of sewage. Fantastic. Of course, the US has far more invested in fossil fuels to actually give such earth-friendly technology room to grow.

[Blutus]

The earthquake has made all the China happy talk
ring hollow. Again.

The earthquake demonstrated that China's progress is built on sand.

It is a sick country trying desperately to enter the 19th century.
I have nothing against China, but I am tired of being compared to them.

They are nothing like the United States and have a long way to go if they want to compare themselves to us. Simple facts.

All we hear is how great this country is, yet a moderate earthquake slaughtered thousands and has practically brought the country to its knees.

Olympics?? I don't know a single person who cares or plans to watch or even thinks it is important.

The world needs to focus on saving human civilization and the Olympics has very little to do with that
enterprise.

China learns yet another lesson about the universality of human suffering.

So leave Tibet the hell alone!

[KillTheMessenger]

If that kind of earthquake hits San Francisco and the Bay Area (and yes, it will), there will be very similar results. Don't bask in someone else's misfortune. American infrastructure is no more advanced in many places. But we know from experience that American first response is basically non-existent.

Me thinks you know nothing about China and even less about your own country. China is not trying to enter the 19th century. It is trying to survive the 21st. I doubt your mind can grasp the difference. One wonders if that is because you have slept through most of the 20th?

[noneIn2008]

Beijing has a temporary, artificial reduction in pollution for the Olympics. Don't spoon feed us their propaganda. Do some real journalism.

[KillTheMessenger]

You are dangerously underestimating the Chinese. If they have shown one thing, it's their will not to make a step back once they have taken one forward. This is very different from the Western mindset which takes these fluctuations for granted (we have invented "Potemkin Villages", after all). What drives the Chinese is not that they want to be like us. They want to be BETTER than us. And not just a little, but by an order of magnitude. And if you are looking at their progress with an open eye and at their past with appreciation of historic facts, you will see that they have a very good shot at reaching that goal.