BUILDING materials and construction companies are jockeying to cash in on the government's go-green policies, but they are finding the doors in the commercial sector easier to open than those in the residential end of the market.
"Green buildings will create a market with an estimated annual output of 1.5 trillion yuan (US$224 billion) in the next decade," said Qiu Baoxing, vice minister of the Ministry for Housing and Urban-Rural Development.
Under the 12th Five-Year Plan that begins next year, China plans to invest 3.1 trillion yuan in the development of advanced technologies to cut energy consumption and reduce emissions. That's an increase of 121 percent from the commitment in the current five-year plan period.
Points of focus
Buildings are one of the latest points of focus. Their day-to-day demand for lighting, air-conditioning, heating and appliances account for one-fourth of the country's total energy use, the Boston Consulting Group and the New York-based Natural Resources Defense Council wrote in a report.
In fact, residential and commercial buildings in China use more energy than the country's iron, steel and cement industries combined, the report said.
"If all Vanke new property projects met the highest standard of the national building-energy-rating system, we would contribute 0.12 percent to China's goal of reducing carbon dioxide intensity, or carbon dioxide emissions per unit of GDP, by 40 to 45 percent by 2020," said Wang Shi, chairman of China Vanke Co, the country's largest residential property developer.
"If all property developers stick to the standards, the contribution would be 12.6 percent," Wang added.
China now requires new buildings to reduce their energy consumption by up to 65 percent.
That opens a lot of new avenues for businesses engaged in production of energy-saving materials and for businesses involved in constructing the buildings that use them.
Ecological buildings involve comprehensive solutions, including high-efficiency insulation, heating, ventilation, glazing, lighting, in-house appliances and renewable energy sources, such as geothermal heat and sunlight.
"The just-finished World Expo in Shanghai was a good marketing campaign to promote green buildings and will serve as a catalyst to opening the eyes of relevant industries," said Wang Mingxu, an analyst with Orient Securities Co.
The SGL Group, a German carbon-based products producer, is among those seizing the new opportunities. Its ECOPHIT material made from expanded graphite ensures optimum distribution of heat and, if properly incorporated, can greatly improve the performance of existing systems.
"We are at the beginning of commercializing the product in China," said Johan Borrey, managing director of SGL Group China. "It may take time for the Chinese market to accept such a new material. China's rapid development, especially in mega cities, is quite exciting and already has a good start in its low-carbon economy development."
Bayer MaterialScience is taking a more targeted and active approach.
It showcased a range of green solutions at the K-Show, the world's largest trade fair for plastics and rubber, which was held in Duesseldorf, Germany, in late October. That included polyurethane insulating panels for roofs, walls and floors, photovoltaic elements in a polyurethane frame and Makrolon polycarbonate sheets, which allow light to pass through yet reflect heat.
The company is bringing its "eco-commercial building program" to China aimed at buildings such as banks, supermarket chains and hotels.
The company said it will gather suppliers together to develop integrated energy and material solutions for buildings, including insulation systems, lighting, air-conditioning, heating and information technology. Architects, planners, building firms and other manufacturers are all part of the team.