One of the top priorities in China’s 12th Five-Year Programme is to accelerate the building of a resource-saving and eco-friendly society through stepping up environmental protection efforts. Accordingly, the Guangdong provincial government has made the construction of a green and low-carbon economy a key development direction in the next decade. A host of measures has been mapped out to contain pollution problems caused by industrial development and rapid urbanisation of the Pearl River Delta (PRD) and to sustain the region’s development. In light of this policy direction as well as other inducing factors, the demand for services in energy conservation, emission reduction and pollution prevention from PRD enterprises has surged in recent years.
Rapid expansion of energy -saving market in PRD.
To tackle problems in excessive emission and energy wastage brought about by high energy consumption, the Guangdong provincial authorities are implementing a range of energy-saving measures, including requiring enterprises to devise and implement energy-saving plans. Under the Regulation of Guangdong Province on Energy Conservation revised recently, new fixed asset investment projects subject to government approval have to undergo energy efficiency evaluation and review, while energy-consuming facilities falling short of prescribed energy efficiency standards must be upgraded.
Meanwhile, enterprises are also induced by the following incentives to actively seek energy-saving solutions:
Expenditure on energy and hence production costs can be reduced.
Low-carbon production is in tandem with the increasingly popular green sourcing requirements of European and US buyers.
Under the “green credit” policy, energy-saving enterprises can obtain credit facilities from banks more easily.
Energy-saving projects meeting the necessary requirements can enjoy preferential treatment in taxation and/or government fiscal incentives.
PRD enterprises, particularly those in the manufacturing industry which accounts for over half of the province’s total energy consumption, have strong demand for all kinds of energy-saving services in areas like energy-efficient air-conditioning, recovery of residual heat and pressure, green lighting, power system enhancement and utilisation of new energy sources. Guangdong’s energy-saving services market is estimated to reach Rmb5-6 billion a year. As the needs in the market cannot be fully met by PRD’s small and medium-sized service providers, opportunities in the market abound for Hong Kong companies.
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