China questions Canadian cleantech companies should consider

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The country’s leaders are determined to re-vamp the heavy energy and resource intensive industrial structure. They recognize that if they do not aggressively build on impressive initial efforts for greening ‘dirty’ industries and creating cleaner, higher value industries now, they will face exponentially higher costs down the road in economic constraints and higher social costs of vast numbers of angry, unemployed, and chronically ill people. These challenges are steadily amplified by the country’s efforts to secure energy, mineral and food resources across the globe that will house, transport, feed and entertain an urban footprint that is expected to grow from between 100 million by 2025 and 350 million over the next 15 to 25 years.
Indeed, China’s fossil fuel consumption (70% of energy demand growth up to 2035), harmful emissions and water strains resulting from the urbanization drive will continue to rise for many years. The good news is that China is vigorously adjusting regulatory direction and allocating money and incentives aimed at increasing the proportion of cleaner inputs and more efficient usage of energy, water and resources.

 

China new energy generation requirements

New Energy Generation (taking into account renewable generation capacity factor) for Electric Power in China in 2013.Source: Matthews and Hao, 2014

 

Cleantech’s ‘second wind’ is ripe for leveraging China opportunity The cleantech sector has faced gusty headwinds in North America and Europe over the last few years. Anticipated game-changing breakthroughs did not materialize. Technology roadmaps and commercialization proved far longer and more costly than envisioned (in part due to weak financing support in the wake of the global recession). The resulting poor returns not only helped sour investor and business confidence in the sector’s promise of a cleaner tomorrow, but also helped amplify public debate on the merits of regulation and tax-payer money supporting more costly cleantech development at the expense of shorter-term economic levers such as cheaper traditional fuels, jobs and social programs.
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