"As
an architect, I find sustainability implementation in China
is more possible than in the west. I think the costs to build
a sustainable building in China is much lower and, frankly,
convincing Chinese clients to buy into these sustainable concepts
has been easier than with US developers."
"People
are confused. Some people say that green building products are
not available in this market and very difficult to find, some
people say that they are here but they are not used, and some
people say that they are here and are used but not by the Chinese
but by the Germans - like solar panels."
"On an individual
community level it's going to be very difficult to achieve
the kind of paybacks that you're looking for but the big opportunity
in China is always going to be the scale. We can scale it
up to such an extent here in China that it will become financially
viable and that's what's really exciting."
The Linked Hybrid- a green
development in Beijing is one
of the world's largest residential
developments
IMPORTANT
DEFINITIONS
A
Tradable White Certificate is an environmental
mechanism common in Europe where by certificate that can be generated
by somebody that carries out energy efficiency and can be traded
with another entity who hasn't carried out as much efficiency as
they are required to do. An example is the Energy Efficiency Commitment
obligation on power suppliers that must carry out an number of energy
efficiency measures within the domestic stock for which they can
generate white certificates. Any supplier that doesn't meet their
requirement is forced to buy their certificates from other power
suppliers. Those that have an excess can sell so it's a free trading
market. Some countries also use policy measures to affect the price.
The key is determining on whom to put the obligations - in the UK
the obligation is on power suppliers but it could equally well be
between different developers or provinces.
An
Energy Services Company (ESCo) will design, build,
own, operate, and maintain energy generating kit for a development,
community, or city. Sometimes, ESCos refer to consulting companies
that provide demand-side management services and make their profits
by charging a portion of the energy savings.
The
Clean Development Mechanism (CDM) is an arrangement
under the Kyoto Protocol allowing industrialized countries with
a greenhouse gas reduction commitment (called Annex 1 countries)
to invest in projects that reduce emissions in developing countries
as an alternative to more expensive emission reductions in their
own countries. The most important factor of a carbon project is
that it establishes that it would not have occurred without the
additional incentive provided by emission reductions credits. Examples
of successful energy efficiency CDM projects in China include heat
recovery systems in cement plants, coal mine methane capture. The
destruction of ozone-depleting HFC refrigerants (potent greenhouse
gases) has also been effective.
Green Dragon was initially launched to discover
the reality behind the mixed messages surrounding local green building
product availability and costs within China. We found that many
of the products and services needed to build green are available
in China and it is even possible in the top-tier markets to build
green more cheaply than business-as-usual (see Accord
21 which cost 10% less than average). Nevertheless, a lack of
industry coordination and information sharing has slowed the spread
of this knowledge.
Key Takeaways:
The Chinese green building movement needs
a 3rd-party trade organization to promote the industry,
develop case studies and facilitate networking and knowledge
transfer.
The focus for green construction efforts
should be on residential because it represents the largest
share of construction. This will, however, be the hardest market
to shift due to its insistence on limiting upfront
costs regardless of payback.
Other industry players mentioned existing
government buildings as another high priority.
More accessible targets include foreign
firms with global corporate social responsibility (CSR)
initiatives and firms with vast project portfolios such
as large high-end developers.
The building blocks of China's green
building
industry slowly being put into place
The price of power is kept artificially low
by the Chinese government so it is difficult for renewable energy
technologies to compete. This also lengthens payback periods for energy
efficiency improvements.
A
summary of the central issues and opportunities surrounding the
green building products and services markets in China:
GREEN
BUILDING PRODUCTS
THE
SERVICES MARKETPLACE
There are numerous opportunities
for foreign technologies - especially in concrete, insulation,
lighting controls, HVAC and renewable energy.
Chinese government funding policies
favor domestic technologies and not those that are using
foreign IP. There are no preferential taxes for environmental
products, the tariff rate is not enforceable and showcase
projects are moving slowly.
When entering the China market,
smaller companies with niche technologies and/or intellectual
property (IP) concerns should form a consortium and focus
around a platform when entering the China market. This platform
could be a flagship "silver bullet" product or
a green building certifications system such as LEED.
To help protect IP, continuously
evolve your product, setup as a wholly-owned enterprise
instead of as a joint venture, and minimize employee turnover
(as high as 30%/yr in Shanghai).
Chinese products lack 3rd-party
product certification and quantification of environmental
benefits. Government-affiliated groups such as Xu Wei'sCABR are developing these but
there are also opportunities for industry groups to produce
their own certifications.
Many green building products
are available in China but are often priced for export,
such as motion sensors or photovoltaic panels. The US-China
NGO JUCCCE is developing a bulk purchasing consortium to drive down
the price of key high-priced products as well as distribute
CFLs with the Clinton
Climate Initiative . JUCCCE is also developing an online marketplace to increase awareness
and usage of green building products.
The Chinese central government's
recent push for sustainable developing is now influencing
local governments of major cities and companies to take
action. Many of them are looking outside China for subject
matter expertise in areas such as: sustainable design &
architecture, LEED certification, energy efficiency, renewable
energy and carbon finance.
The industry needs case studies
that have been proven with hard data on efficiency and cost
savings.
Carbon finance mechanisms could
accelerate expansion of the Chinese green building industry.
CDM has been very successful in the Chinese industrial sector
and tradable white certificates have worked well in Europe.
There is a large opportunity for the power supply ESCo-model
in China. ESCos are common in China because of the district
heating systems. The owners/project developers of the energy
generating equipment builds, operates and maintains that
equipment…and bills the customers on site. The major limitation
is that energy costs are artificially low.
The
Chinese government has focused on building energy efficiency
for many years; however, there are no comprehensive Chinese
green building rating systems and, to date, the USGBC's LEED
system has primarily filled this void.
“I
think its important to say why Chinese developers –
as well as multinationals that are NOT based in America
(L’Oreal, Siemens, HSBC, etc) have almost unanimously
gone for the US certification.”
“Looking
to the future I think green buildings in China will
increasingly get the technology but will they get the
maintenance? And will they pay for the maintenance down
the road? That’s the thing that kills these projects.
The western and Chinese concepts of maintenance are
different…I think the green technologies that
are going to get accepted are the ones that have the
least maintenance. That’s why solar water heaters
are really popular …very simple technology”
China lacks a fundamental
characteristic of mature market economies that is often taken
for granted in the West and that is the organizations, whether
governmental or independent, that take the role of promoting
and communicating trade opportunities. As a result it is very
common to hear conflicting viewpoints of what green building
products can be sourced within China and how much they cost. A RESPONSE
The US-China NGO JUCCE
is working to create an online marketplace for buyers and
sellers of energy efficient and clean energy products and
services, they are building a bilingual energy industry glossary
and a geographical map of energy projects and resources in
China.
INTERVIEW
CLIPS, click ‘play’ to see the selected clip from the
list below:
Stanley Yip (叶祖达) Chinese/English
Sustainability consultant
in Shanghai (上海)
Director, Planning & Development
(规划及发展总监)
Arup (Shanghai) (英国奥雅纳工程顾问有限公司 上海分公司) www.arup.com/eastasia
Stanley is responsible for the development and implementation
of Arup's planning practices in Mainland China. For the past
2 years, he has focused on the economics of sustainable urban
planning. View Bio
Products - Use local partners with an
eye to the long-term
Charles R. McElwee English
Environmental lawyer in Shanghai (上海)
Counsel
Squire, Sanders & Dempsey L.L.P. www.ssd.com
Charles advises foreign companies on environmental compliance
issues in China as well as the opportunities that have been
created by China's environmental situation. He is also involved
with JUCCCE. View Bio
Products - Challenges entering the China market
and opportunity for consortium
Wang Hong (汪洪) Chinese/English
Green building consultant in Beijing
General Manager (中国区总经理)
Environmental Management Solutions, Inc. (EMSI) (美国EMSI环境管理咨询有限公司) www.emsi-green.com
Wang Hong heads up EMSI's China operations which have consulted
on almost 30 LEED projects in the country. View Bio
David DeMontaigne English
Professional services firm in Shanghai (上海)
Chief Executive Officer (首席执行官)
Eco Energy Cities PLC (生态能源城市有限公司) www.eco-energy-cities.com
David de Montaigne has over 30 years of experience within the
Oil and Gas, Energy, Renewable Energy, Project Development and
Investment Banking sectors. His firm delivers innovative sustainable
design and development powered by renewable and alternative
energy systems. He is also involved with JUCCCE. View Bio
Products - Need a silver bullet product as
platform for entering China
Charles R. McElwee English
Environmental lawyer in Shanghai (上海)
Counsel
Squire, Sanders & Dempsey L.L.P. www.ssd.com
Charles advises foreign companies on environmental compliance
issues in China as well as the opportunities that have been
created by China's environmental situation. He is also involved
with JUCCCE. View Bio
Products - Intellectual Property (IP)
Curt Weinstein English
Product manufacturer in Shanghai (上海)
General Manager China, Environmental Technologies (总经理-中国 环境科技)
Corning (Shanghai) Co., Ltd. (康宁（上海）有限公司) www.corning.com.cn
Curt heads up Corning's China operations which primarily produce
ceramic substrates for vehicle carburators and other pollution
control devices. He has a wealth of experience manufacturing
and selling high-technology environmental products in China.
Products - Advice for protecting intellectual
property (IP)
Dr. Roland Winkler German/English/Chinese
Sustainable construction consultant in Shanghai (上海)
Project Development Coordinator, Building, Energy & Environment
Econet China www.china.ahk.de
Roland founded a green building association called Sinobao which
initiated a green building expo between Hamburg and Shanghai
called Ecobuild
Shanghai 2006. He also has a sustainable development consulting
firm based in Munich. He is also involved with JUCCCE. View Bio
Products - Quality will ensure long-term success,
weather the copy-cat storm
Daniel Zhu (朱盾鸣) Chinese/English
Consultant and Venture Capitalist in Shanghai (上海)
President in China (中国区总裁 董事)
Transpacific Resources, Inc. USA (TPR) (美国跨太平洋资源有限公司，上海同坤实业有限公司) www.tprinc.net
Daniel provides business and investment consulting as well as
venture capital services within the renewable and clean energy
field. He is senior advisor to the country's largest solar thermal
company. He is also involved with JUCCCE. View Bio
Products - Opportunities with local government
and existing buildings
Dr. Jean Rogers English
Green building consultant in San Francisco
Associate Principal
Arup www.arup.com
Jean is leading Arup's sustainability consulting on the Qingdao
Eco Block project with Harrison
Fraker and Leon Huang. She
is also leading Arup's work with San Francisco's Treasure
Island community. View
Bio
Products - China is up to speed on the technologies
and ahead in some
Qian Yingchu
(钱颖初)
Chinese/English
Green building consultant in Shanghai (上海)
District Manager (Shanghai & South China), Director of Projects
(区城经理（上海及南中国），兼项目总监)
Environmental Management Solutions, Inc. (EMSI) (上海EMSI环境管理咨询有限公司) www.emsi-green.com
Qian Yingchu has consulted on a number of LEED project in China
and also has experience with training programs for government
officials. View Bio
Products - Most products can be sourced in
China but must look at building as a system
Silas Chiow
(周学望) English/Chinese
Architect in Shanghai
Associate Partner / Director of Business Development (副合伙人，大中国区业务总监，美国注册建筑师)
Skidmore, Owings & Merrill (SOM) www.som.com
Silas oversees SOM's China business and design. He is also closely
affiliated with the Urban
Land Institute. SOM did the design for the Xintiandi
development in Shanghai and their sustainability design was
chosen for Chongming
island, off Shanghai (the site of the planned Dongtan
Eco-city). View Bio
Products - China opportunity and local production
example on green building project
Hideki Hirahara (平原英树) Japanese/English
Associate in Beijing (北京)
Steven Holl Architects www.stevenholl.com
Hideki is an architect working on the Modern Investment Group's
massive MOMA Linked
Hybrid residential complex in Beijing. The 2.3 million sq
ft project will have one of the world's largest geothermal systems
as well as a waste water recycling plant.
Products - Green building products are easily
available in China or can be cheaply fabricated
Jervy Zhu Chinese/English
Architect in Shanghai (上海)
Asia Operations Manager (亚洲部执行主管)
GBBN Architects (GBBN建筑师事务所) www.gbbn.com
GBBN has a strategic partnership with China's largest residential
developer, Vanke(万科集团) and Jervy heads up GBBN's China operations.
Products - Difficult for architects to know
local product availability
Wang Hui (王辉) Chinese
Architect in Beijing (北京)
Partner
Beijing Limited_Design Ltd., Beijing 2529 Architect Studio,
北京有限设计有限公司合伙人,北京二五二九建筑工作室合伙人 www.mima.cn
Wang Hui’s design work has been featured in over 17 domestic
and international exhibitions. Recent projects include the Beijing
Worker’s Stadium Retrofit and Beijing 798 Art District. View Bio
Products - The products are here but people
don't know it
Lao Weixing (劳卫星) Chinese
Government official in Cixi, Zhejiang (浙江慈溪)
Senior Engineer (高级工程师)
Cixi Construction Bureau (慈溪建设局) www.cixi.gov.cn
Products - Products needed to achieve government
building efficiency targets
Marcus
Tehan English
Real estate service provider in Shanghai (上海)
Senior Project Manager - Project & Development Services,
Corporate Solutions (高级项目经理-项目发展服务部 企业综合解决方案)
Jones Lang LaSalle (仲量联行) www.joneslanglasalle.com.cn
Marcus leads Jones Lang LaSalle's sustainability initiatives
for China. He is also involved with JUCCCE.
Products - The technology is in China but
need education and case studies
Ge Yi (葛毅) Chinese/English
Environmental consultant in Beijing (北京)
Policy and Management Advisor (政策管理专家)
EU-China Energy and Environment Programme (中国-欧盟能源环境项目) www.eep.org.cn
Ge Yi is an associate of Roggeo
Design assisting with lighting strategy and is also a senior
advisor to the China-EU Energy and Environment Programme which
led the very successful China Green Lights program.
Products - A successful product awareness
campaign: the China Green Lights Program
Jason Hu
(胡建新) Chinese
Developer in Shenzhen, Guangdong (广东深圳)
Deputy General Manager, Professor and Senior Engineer (副总经理，教授，高级工程师)
China Merchants Property Development Co. Ltd. (招商局地产控股股份有限公司) www.cmpd.cn
Jason headed the Fraser
Place development project, the first commercial building
to achieve LEED Silver. He is now working closely with One
Planet Living, to build a carbon neutral community in China.
He is also involved with JUCCCE. View Bio
Products - Most products are here and have
export potential but need certification
David Nieh (聂耀中) English/Chinese
Developer in Shanghai (上海)
General Manager - Planning & Development (总经理－计划及发展)
Shui On Development Ltd. (瑞安房地产发展有限公司) www.shuionland.com
David is passionate about sustainable development and smart
urban planning. Some of his recent Shanghai projects include
Xintiandi
and the Knowledge
& Innovation Community (KIC). He is also involved with
JUCCCE. View Bio
Products - Price still too high and too many
standards
Xu Wei (徐伟) Chinese
Government official in Beijing (北京)
Director, Researcher （院长 研究员）
China Academy of Building Research (CABR), Institute of Built
Environment and Energy Efficiency （中国建筑科学研究院 建筑环境与节能研究院） www.cabr.com.cn
Xu Wei Works for China's largest research, development, and
technology promotion group. He focuses on research, development
and regulations regarding energy efficiency aspects of buildings
and building-integrated technologies. View Bio
Products - Government activities to certify
products and issue of building operations management
Fei Chunlu
(费淳璐) Chinese
Developer in Shanghai (上海)
Chairman (董事局主席)
China New Town Holdings (中国城镇控股) www.chinanewtown.com
Fei Chunlu is a pioneer in green town development. He is completing
the second phase of Anting
New Town, a German-designed, energy efficient development
in the Shanghai suburbs.
Products - Need to focus on access and then
end-of-life disposal
Tate Miller English/Chinese
Industry and Trade representative in Beijing (北京)
China Director for Trade Policy (贸易政策中国总监)
American Forest & Paper Association (AF&PA) (美国林业及纸业协会) www.afandpa-china.org
Tate oversees all of AF&PA's policy issues and acting as
the primary liaison between Chinese government officials and
forest product industry groups. View Bio
Products - Market for steel & concrete
construction vs. wood framing
Rob Watson English
Integrated Green Solutions Provider in New York
Chairman, CEO & Chief Scientist
American SinoTech www.american-sinotech.com
A pioneer of the modern green building movement for over twenty years,
Rob helped develop the USGBC's LEED green building rating system. He
was also deeply involved in the construction of China's 1st green
building, Accord 21. He is also involved with JUCCCE. View Bio
Tate Miller English/Chinese
Industry and Trade representative in Beijing (北京)
China Director for Trade Policy (贸易政策中国总监)
American Forest & Paper Association (AF&PA) (美国林业及纸业协会) www.afandpa-china.org
Tate oversees all of AF&PA's policy issues and acting as
the primary liaison between Chinese government officials and
forest product industry groups. View Bio
Services - Chinese will do it their way
Hannah Routh English
Environmental consultant in Beijing (北京)
Managing Director (经理)
ESD Sinosphere (博信国际信息咨询公司) www.camcoglobal.com
Hannah is working with REEEP
to explore carbon finance options for the building industry.
She is also working with Jason Hu to ensure his One
Planet Living community will be carbon neutral. She is also
involved with JUCCCE.
Services - Carbon Finance
Jason Hu (胡建新) Chinese
Developer in Shenzhen, Guangdong (广东深圳)
Deputy General Manager, Professor and Senior Engineer (副总经理，教授，高级工程师)
China Merchants Property Development Co. Ltd. (招商局地产控股股份有限公司) www.cmpd.cn
Jason headed the Fraser
Place development project, the first commercial building
to achieve LEED Silver. He is now working closely with One
Planet Living, a joint initiative of BioRegional and WWF,
to build a carbon neutral community in China. Jason started
China’s first non-governmental international annual forum on
sustainable development, called the International Green Development
Forum. He is also involved with JUCCCE. View Bio
Hannah Routh English
Environmental consultant in Beijing (北京)
Managing Director (经理)
ESD Sinosphere (博信国际信息咨询公司)
www.camcoglobal.com
Hannah is working with REEEP
to explore carbon finance options for the building industry.
She is also working with Jason Hu to ensure his One
Planet Living community will be carbon neutral. She is also
involved with JUCCCE.
Services - Energy Services Companies (ESCo)
Charles R. McElwee English
Environmental lawyer in Shanghai (上海)
Counsel
Squire, Sanders & Dempsey L.L.P. www.ssd.com
Charles advises foreign companies on environmental compliance
issues in China as well as the opportunities that have been
created by China's environmental situation. He is also involved
with JUCCCE. View Bio
