This excellent clip by Radio Netherlands Worldwide tells of Dutch consultancy and engineering firm, DHV, and their efforts in Tianjin on the “Delta Diamonds ocean city development project.” Naturally, it is labeled as an eco-city project–Green sells, so why not? The objective, in a nut shell, is to create a series of new islands through land reclamation and build a new community for 20,000 people. The site of these Delta Diamonds, as they are called, so happens to be right next to the Sino-Singapore Tianjin Eco-City, which we have blogged about previously here, here and here.
Yesterday, The Green Leap Forward took to the road to Tianjin again, this time as part of a US-delegation organized by the US-China Green Energy Council (UCGEC) exploring the green tech potential of Tianjin. One of the stops was a visit the site of the proposed Sino-Singapore Tianjin Eco-city. Not much more to report from our previous post, but we got some cool visuals. Upon arrival, we were quickly ushered into an enclosed building, only to be shown poster exhibits that is basically a rehash of the master plan already available on their website. The saving grace was a large model of the city that we took some pictures of: Read the full story
China has become an international capital and laboratory for eco-city projects. The unprecedented scale of rural-to-urban migration is creating pressing demands on existing urban infrastructure, but also the opportunity for city planners to create new cities based on more sustainable, and even ecological patterns of development.
Rising from above the fray of the multitude of eco-city proposals is the Sino-Singapore Tianjin Eco-city project (sketch drawing pictured), which is the first of any of the proposal, as far as The Green Leap Forward knows, to have actually broken ground. This blog first mentioned this project back in February. On September 28, ground was broken and municipal regulations (hereinafter, the “Regulations”) governing the development of the project came into effect. The remarkable speed at which this project moved from concept (in April 2007) to groundbreaking, while other projects which have been planned and talked about for years remain mired in bureaucratic standstill, can be best be explained in the context of Singapore’s long term economic relationship with China. This is not the first time both countries are collaborating on a township-scale development project in China; Suzhou Industrial Park was the first in 1990s and just last month, China and Singapore also entered into a bilateral free trade agreement. Read the full story
If China’s Green Leap Forward fails for whatever reason, it won’t be because of the lack of cash. Generally speaking, it has never been better to be a clean tech entrepreneur or project developer. Investment dollars are pouring in globally from hedge funds, private equity and venture capital funds, multinational corporations and development banks. Take these recent developments, for example:
- The clean development mechanism (CDM) under the Kyoto Protocol, for example, provides the much needed financial lifeblood to take IRRs of wind farm projects over the “hurdle rate.” There has been some criticism about the use and abuse of CDM by some camps, such as a front page article by The Guardian, but I thought China Environmental Law’s response was spot on. China is by far the world’s biggest market for CDM projects, accounting for a whopping 73% of transactions in 2007. Hong Kong joins the CDM fray as well.
- Sycamore Ventures and the China Association of Resources Comprehensive Utilization (CARCU), which operates under the State-owned Assets Supervision and Administration Commission, are to launch a US$ 1 billion dollar Greenstar fund to invest largely in China’s environmental sector.
- The World Bank will provide additional $440 million in loans for three energy efficiency projects. This will constitute one-third of the bank’s loan portfolio in 2008 to China. The three projects consist of energy efficiency financing, desulfurization in Shandong and infrastructure in medium-sized cities in Liaoning.
All this is not to say that China is reliant on external sources of funding. In fact, according to a Reuters report, Gao Guangsheng of the National Development and Reform Commission expects China to fund 90% of its renewable energy development by domestic sources of funding. Separately, Don Ye, founding partner of Tsing Capital’s China Environment Fund, for seven years, and still, China’s only fund 100% dedicated to clean tech investments told The Green Leap Forward, “There’s a trend to self sufficiency both in terms of talent as well as investments. By the end of this year, we expect to see quite a few RMB-denominated investment funds come to the market.”
Provincial and municipal governments are also investing big in renewable energy. The northeastern municipality of Tianjin has committed to invest RMB 200 million a year into mergers and pre-IPO deals in solar, wind and energy storage businesses. The southwestern province of Sichuan is pushing solar development in a big way, as evidenced by last weekend’s Western China PV Conference held in the province’s biggest city, Chengdu (成都). The governments of Chengdu and adjacent Shuang Liu (双流) county, together constituting the aviation hub of China, have now have established the Chengdu (Shuang Liu) Photovoltaic Industrial Park with the goal of becoming China’s “solar PV valley.” I’ll write more about the Western PV Conference in my next post.
There will be occasional bottlenecks to capital availability. Last month, the central government raised bank reserve ratios yet again to reduce liquidity in the market so as to combat inflation. The series of bank reserve ratio increases has resulted in a tightening in the availability of bank loans for renewable energy projects (although these have tend to affect foreign project developers, which are typically last in line, more than the major state-owned enterprise developers, which get priority access to capital) . But such a phenomenon does not detract from the favorable patchwork of investment policies enacted by the central, provincial and municipal governments for clean energy. If I were a betting man, my money would be on the red (the color of RMB 100 notes) to continue chasing the green (energy).
Eco-cities are in vogue. Renown eco-architect William McDonough has long been a champion, global engineering firm Arup is building a high-profile one near Shanghai, and earlier this year, Abu Dhabi announced its own eco-city intentions through the Masdar Initiative.
The Sino-Singapore Tianjin Eco-city is among the latest projects to join this growing movement. First announced last November (click here for an interesting piece on how Tianjin was first selected as the site for the eco-city), the Tianjin eco-city projecy is jointly planned and managed by the governments of Singapore and Tianjin, and will cover an area of 30 square kilometers and is projected to be inhabited by some 300,000 residents. A master plan is to be completed by March, and ground is to be broken by July. The eco-city will integrate sustainable design and engineering covering at least 18 aspects, including public transportation, buildings, waste management and recycling, energy efficiency, air quality.
While the design of utopic eco-cities have been the stuff of science fiction for decade, commitments to actually make such science fiction reality is a more recent phenomenon, but one stemming out of imperative rather than coincidence. China is witnessing the largest scale of rural-to-urban migration in history. As of the end of 2006, some 44% of China’s population lived in urban areas; that figure is set to grow to as much as 70% by 2050, consisting of 1.1 billion people engaging in economic activities that are more energy intensive than rural activities and will put a heavy strain on resources unless more sustainable paths to development are deployed.
According to this piece from WorldChanging, if McDonough’s and Arup’s experiences are to be any indication, execution of the best-laid plans to build an eco-city may prove challenging. For an eco-city to truly come alive, green living must capture the hearts and minds of all levels of government and a significant portion of the residents, otherwise, the purpose and function of the city’s green infrastructure will not be fully utilized or properly maintained. It is important to realize that a city is not merely a static collection of buildings and roads, but consists of an organic, dynamic and evolving living space in which people adapt to or modify over time. If such adaptations or modifications are not consistent with the ecological design, the eco-city is doomed to fail. Viewed another way, that would be like installing the eco-city hardware with faulty software, causing the system to underperform, or worse still, overheat.