The water business in China - Chinese challenges – Danish opportunities

Agenda

• Highlights on China and water

• The 12. Five-Year Plan

• Implications for Danish water companies in China

• Chongqing. Water cluster or clean tech cluster?

• Chongqing’s 12. Five-Year Plan on water

• Denmark – Chongqing Water Days 2011

• Environmental Audit Reports

Highlights on China and water (1:2) • Approx. 20% of the world’s population lives in China • China has 7% of the water resources • Only 20% of the water resources are in the North of China were

46% of the population lives• In a normal demand year the annual water gap in China is 30-40

billion m3• Approx. 400 out of the 600 largest cities in China are hit by severe

water scarcity*• Beijing is sinking with approx. 1 meter annually and is named “the

driest city in the world” (The South-North Water Division Project leading Yangtze and other rivers northwards demanding 600 billion DKK in investments and keeping 70-80.000 people occupied for approx. 40 years)

* OECD

Highlights on China and water (2:2)• The scarcity of water is enhanced by serious water pollution with a

total of 75 billion m3 wastewater discharged*• Only approx half of the wastewater is treated• 70% of Chinas drinking water is groundwater• Pollution from industries, households and farming has resulted in

90% of China’s cities are hit by contaminated water and only half of the cities live up the national standards for drinking water quality

• In the countryside the rivers are the main source of drinking water. However, 40% of the rivers are polluted and not suitable for drinking

• China is amongst the countries using most fertilizer and pesticides per m3 farming land

• Flooding is now seen upon as a source of water

* 2007 figure

Segmentation of the water pollution market

Source: IBISWorld Inc., All China Marketing Research Co., Ltd., 2010

Size of the water pollution control industry: 600 million USD in 2010.

Topography of a Chinese Five-Year PlanAll policy levels are involved

National planRegional

plans

Local plans

Topic oriented plans plus longer term planning

Laws, programmes ect

Central policy goals

Incorporation of lower

level plans

Source:1.APCO Worldwide and China Greentech Initiative analysis

Key areas and targets in the 12. Five-Year Plan• China is committing to a green economy development

• Key point in the 12th 5-year plan in the Energy & Environment sector– 7 new strategic industies issued by the State Council (Energy

savings and environmental protection as one implicating an emphasis on the construction of urban waste water as key)

– Create more mandatory “green” targets– Set green development indicators to hold local officials

accountable– Expand new energy – wind, solar, intelligent grid and biomass

Implications for the water business• RMB 4 trillion investment in infrastructure• A binding target for decrease in water consumption per unit of value-

added industrial output by 30% from 2010 to 2015• 40 billion m3 urban water supply capacity • Improvement of large irrigation districts• Urban waste water plants and treatment systems for rural areas

Integrated solutions Pricing mechanisms and management systems Recycling and monitoring systems Upgrading of existing plants

Introduction to Chongqing 19

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Chart TitleBln yuan GDP Growth in Chongqing

1996 1998 2000 2002 2004 2006 2008 2010 20120.0

10.0

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29.5 31.0 32.6 34.3 35.6 37.4 39.9 41.9 43.5 45.2 46.7 48.3 50.0 51.6 53.0

Rate of Urban population in Chongqingpct.

Water Cluster or Clean Tech Cluster

Three companies share one em-

ployee located in the TC-C incubator

Collect key information to

devise a strategic development

plan for Chinese market.

Devotion to one area can lead to more attractive opportunities.

Employee to rely on TC’s great network and

regularly assistance

Hold regular promotional

activities with the participation of key customers, relevant govern-mental staff, and

other stake-holders.

Pay visit to a cross section of stakeholders in

China, especially end-users.

Show s commitment to

the Chinese market which will

improve the relationships with

the Chinese stakeholders

Low cost solution

Easy access to network & info

Why a cluster?

Plug-and- play solution

Chongqing’s 12th Five-Year Plan on Water (2011-15)  • Investment on 18.9 billion RMB in waste water treatment

– 215 waste water treatment plants – 34 sludge treatment projects – 7 water recycling projects

• Water supply: Three projects for water abstraction and pumping stations will be finished; furthermore, one of the projects also includes water treatment and water distribution systems.

• Opportunities: Industrial and rural waste water treatment facilities– Recovering materials– Fulfil local discharge standards– Easy to install and low cost for operation and maintaining

Discover the

huge

potential!

Get updated on Chongqing’s new 5-year water plan!

Meet your customers

along the Liang Tan River!

Customised B2B match-making workshops!

Access to important equipment promotersPresentation of

environmental Audit from

COWI and resulting

opportunities

Background for Environmental Audit Report from COWI

• Under the MOU between the Royal Danish Embassy of Denmark and The Municipal People's Government of Chongqing, COWI China has conducted Liangtan River Phase I project and identified 5 factories to conduct Liangtan Phase II project (Environmental Audit).

• The five factories include:– one textile dyeing factory (F1)– three electroplating industrial

zones (F2, F3, F4)– one lead acid battery factory (F5)

• In addition the audit of the shared wastewater treatment plants (WWTPs) of the three electroplating zones is described in a separate report. (F6)

Recommended equipment – alternative no. 1F1, F2, F3 and F4 - Textile dyeing factory and three electroplating industrial zones • Accumulating water meters• Water flow meter• Reverse osmosis for production of DI-water (De-ionized water)

and for water recycling• Air-lift pumps for counter current flow systems• Ion-exchangers for water recycling• Carbon filters for removal of organic compounds in process

baths and recycled water• Conductivity meters for control of rinse water quality• Evaporators for chrome baths• Metal recovery equipment (Electrolysis)• Dialysis equipment or for purification of pickling baths• Passivation chemicals without Cr(VI)• Process tanks with cover and extraction

F5 - Chongqing Huafeng Battery (Group) Company Ltd• Sand filter for final separation of sludge particles in

wastewater• Activated carbon filter for COD removal in wastewater.• New plate washing line including conveyer system and ion-

exchanger• Investigation of extraction system for the formation process

including improvement• of the extraction by using a capture rate of 0.5 m/sec for the

acid mist - also when one or more covers are open• Coating of the floor in the slag storage to prevent leakage of

slag components through the floor and into the ground. 

F6 - Wastewater treatment for industrial zones with metal plating workshops• Better control of pH• Separate collection system for spent concentrated process baths• Reduction of chrome(VI)• Reduction of consumption of ferrous sulphate• Improved sludge separation• Water reuse• Automation and monitoring• Line sensors to measure:

– Oxygen concentration– Sludge concentration– Levels in the tanks.

Aeration from Textile dyeing factory

Recommended equipment – Alternative no. 2• Water meters and Water flow meters• Water recycling• Carbon and sand filters• Conductivity meters for control of rinse water quality• Metal recovery equipment (Electrolysis)• Passivation chemicals without Cr(VI)• Process tanks with cover and extraction• Investigation of extraction system• Coating of the floor in the slag storage • Different kinds of on line sensors to measure:

– Oxygen concentration– Sludge concentration– Levels in the tanks

Alkali zinc plating tank from electroplating zone

Mixing tank for wastewater and Fe2SO4 as reducing agent and some NaOH for neutralization from the Textile dyeing factory

Tank formation system with the covers for acid fog collection being open due to malfunction of exhaust system in one lead acid battery factory

SUSANNE NORS / SUSHEB@UM.DKCOMMERCIAL COUNSELLOR (ENERGY & ENVIRONMENT), LL.M, EMBADIRECT +86 (10) 85329981 MOBILE +86 139 1187 0373

HANS HALSKOV  / 林汉祥 / HANHAL@UM.DKCONSUL / TRADE COMMISSIONERDIRECT +86 23 6372 5280MOBILE + 86 135 946 365 99