China takes baton of global leadership in sustainable development and clean technologies

As a Briton living in Shanghai and working on sustainable urban infrastructure projects in Asia and around the world, the passing of the Olympic torch from Beijing to London resonates strongly, not least because it underscores the efforts that both countries have made in driving sustainable development at their Games.

On the eve of the Olympics, I spoke at the UK-China Business Day alongside leaders of Chinese companies such as Huawei, Foshan, SOHO, Central China Real Estate and Neusoft. And it became apparent to all of us that the UK and China are the book ends on the finite shelf of fossil-fueled industrialization. Both know it's time to jump to another more sustainable phase of economic growth. So as London received the torch, China took the baton as it tackles mass urbanization and turns its challenges into a global leadership position in sustainable development and clean technologies.

China is not only a global economic superpower, it is the new land of opportunities. That explains why I moved to China to lead our sustainability services practice in the region, where we aim to be the partner of choice for industry, government and civil society. The country is committed to improving its environmental footprint.

The banking regulatory commission recently released the green credit guidelines to help advance environmental considerations across the financial sector and support large scale project financing. China is setting up seven domestic carbon markets across the country. Through China's green building action plan, the country expects to add about 100 million square meters of green building space. And significantly, Premier Wen Jiabao recently stressed that China is revising its GDP growth target from 7.5 percent to 7 percent with a greater focus on protecting the environment and resources.

With an eye on achieving sustainable development, China must prioritize its efforts, resources and capital on Clean Energy, Intelligent Cities and Resource Efficiency. It must build what we call "A New Resource Economy", one capable of supporting harmonious urbanization and sustainable growth.

China has a growing middle class of over 300 million and a manufacturing sector accounting for almost half of GDP growth. Primary energy consumption in cities like Shanghai is three times that of the United States, relative to GDP, and eight times that of Japan. It requires a strong backbone of clean and renewable energy production and generation. Of the $257 billion invested globally in clean energy in 2011, close to 20 percent was in China. Further in the 12th Five-Year Plan (2011-2015), China will spend a staggering $473.1 billion on clean energy investments with a goal to source a fifth of its energy from renewable sources.

Resource Efficiency and Intelligent Cities are two highly inter-related strategic options. Close to 500 million people are likely to relocate to urban centers in China by 2030. The concept of Harmonious Urbanization can help China manage this unprecedented growth and balance societal and environmental implications.

It requires four key elements: smart living, low carbon workplaces, greener modes of transportation and sustainable infrastructure. Smart living requires households to use resource-efficient and high-tech appliances to minimize energy demand without affecting lifestyle and comfort. China must look at creating low carbon workplaces by driving energy efficiency programs in commercial highrise buildings and other properties which account for about 28 percent of the country's total energy consumption. Greener modes of transportation include commercializing electric vehicles and plug-in hybrids as well as innovative traffic planning. All these initiatives need to be backed by infrastructure which focuses on the recycling of waste and building materials and which maximizes waste-to-energy generation. Finally, there is a need for strong and effective policymaking to ensure successful implementation.

The Beijing Olympics demonstrated the scale at which China can drive sustainable development but also represented the challenges it will have in managing sustainable growth. Despite efforts to reduce pollution by shutting down factories, restricting car usage and slowing down construction, favorable weather conditions and wind patterns played their part. But there were also some extraordinary examples of sustainable infrastructure. The Beijing Water Cube, the world's largest ETFE (ethylene tetrafluoroethylene) building has been harvesting close to 140,000 tons of water every year since 2008. The Games sourced about 27 percent of its total energy needs from renewable sources, which compares favorably with London's target of 20 percent.

The Olympic Games provides a template for collaboration between teams. And this teaming spirit was extended in London on the eve of the Games as top Chinese CEOs visited the UK to meet the prime minister, other policymakers and senior British business leaders to collaborate on business and development.

Low carbon and sustainable development led the agenda and Chinese CEOs recognized the need for Chinese companies to exploit ICT and innovation as tools to drive the sustainability agenda within the context of aggressive growth strategies. Innovation is not just about technology but may take the form of new products, new operating models, new brand concepts and new partnership models, especially with UK companies that have had success in driving sustainability.

Public-private partnerships are vital to accelerate the sustainability agenda in China. Success depends on three key elements.

First, strong leadership and a governance structure are paramount. Second, all stakeholders in public-private partnership projects should have well defined roles and responsibilities and understand how their strategy translates into implementation. Finally, a value driven approach must be employed and individual value for each stakeholder should be quantified. This final element is crucial since it brings all parties to the table with commitment.

Accenture has supported such partnerships across the world. We helped drive the smart grid project for Sino-Singapore Tianjin Eco-City on various dimensions like customer experience, power reliability, low carbon technology and innovation. At Amsterdam in the Netherlands, Accenture assisted the city in bringing together myriad players to deliver energy efficiency projects to homes, offices and transport.

In London, Accenture has worked with the London Development Agency and Mayor Boris Johnson's office to roll out an energy efficiency retrofit program for buildings that aims to reduce energy use in London's public buildings by 25 percent.

China can learn from these examples as it takes the next big step in sustainability. An old Chinese proverb best describes the country's present situation: If you want to know your future, look into your present actions. With the scale of its ambition and potential investments, China has the chance to win the race to sustainable economic development. As I saw at that Olympic gathering of UK and Chinese business leaders, it is clear that Chinese decision makers are doing the right thing by exploiting the knowledge and expertise of those who are passing China the baton.

Peter Lacy is managing director of Accenture Sustainability Services for the Asia-Pacific region, based in Shanghai. He spoke at the UK-China Business Olympics Day and chaired the Mayor of London's Olympic Debate on the Future of Cities on Aug 10. The views expressed here do not necessarily reflect those of China Daily.

(China Daily 08/17/2012 page11)