Bright Business Consulting LLP

Friday, September 21, 2018

Renewable Energy in China

The need to cope with an increasingly high energy consumption, due to the increase of population and social welfare, and industrial growth, the desire not to depend in the future on imported oil or coal extraction, have led to closer attention of the Chinese central Government towards the development of "Renewable Energies", which sees this as a crucial challenge for the future of the Country. Government policies on renewable energy have given stimuli and greater safety for both Chinese and foreign investors, resulting in an unprecedented growth of investments on "Renewable Energies" in China, driven by the increasing demand for energy in the region.

The Chinese domestic energy production is mainly based on the exploitation of coal, which due to the large reserves in the subsoil of China, covering nearly 80 % of China's energy, while oil and natural gas, exploited, especially in Western Countries , Europe and United States, has less impact, given the scarcity of these resources on the territory of China.

Thanks to the needs, to the economic structure, to the government policy and the economic boom that is experiencing, China has established itself in recent years as a leader in the field of "Renewable Energies", both in the field of new investments, especially in the field of hydroelectric and wind, of R&S (based almost exclusively on public funding), and the production of electricity derived from hydroelectric and geothermal plants (solar covers the 3rd position worldwide in both the investment in the production date from the exploitation of solar energy). Specifically, with regard to investments in the various sectors of the "Renewable Energy", the wind energy is predominant, which accounts for over 60% of investment, followed by solar, with more than 25%.

The hydropower sector is one that has had more public funding in recent years, with an increase of up to 30 GW of power in the past 4 years with many installations, such as the now famous Three Gorges hydroelectric power plant, the largest in the world, completed in 2011. The central Government has long understood how the development and production of "Renewable Energies" is one of the key challenges of the future and is willing to invest in this sense, because various studies done by government institutions have found that China is rich in everything you need to produce "Renewable Energies". Essentially there are two reasons for the great attention of Chinese institutions towards the development of "Renewable Energies":

  • The first is due to domestic political considerations, since it is the only way to ensure the energy needs of the private system of China, has registered a dramatic increase for ten years as well as being a great opportunity from the point of view of evolution the Chinese economic system, because China needs to transform from low cost economy to a technology-intensive one, and the development of the green economy can attract technology and skills necessary for the general purpose.
  • The second reason is the possibility to become a leader in the production of an ever growing industry, with exports increasing, giving rise to domestic enterprises with a thriving future assured for a long time, investing in research and development and increasing production to decrease the costs of "Renewable Energies".

Despite the Chinese government policy shift towards a green economy in recent years is certainly not due to ecological considerations but purely economic, it is effective and has surely made a decisive contribution to the development of China's private sector, although it is very far off the time of his maturation, i.e. the time when it is able to travel on its own feet and to be able to cover at least half of the national requirement.

Given that Bright Business Consulting LLP does not work in the field of "Renewable Energies" in the first person, but is involved in this area through consolidated and calcified in the "PEE Project", useful to the accompaniment of the companies involved in this market. However in this scenario the analysis through a "Consulting for Company Investigation & Commercial Information" is a right advice, especially for businesses that want to operate in the field of " Renewable Energies" by selling equipment and/or related accessories.



In order to operate successfully today and in the future, in the growing industry of renewable energy in China is absolutely recommended to have a local commercial presence this also in order to have access to both the contributions provided and the tax benefits of the case. To this purpose, a Chinese legal figure with appropriate accreditation is recommended and Bright Business Consulting LLP is the ideal partner for the implementation of the representation.

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