Tag Archives: sustainability

What It Would Take To Build Greener, More Liveable Cities in China: A Lot

Apartment buildings in Foshan, Guangdong province.   (Photo: China Daily / Meng Zhongde)

This Bystander likes a hypothesis that can spread its wings and take flight. That land-use reform and reform of local government finances are key to developing sustainable, efficient, livable, and competitive cities in China would be one such proposition.

It is not so fanciful an idea. The argument runs thus:

Low-carbon cities need compact urban form and smart spatial development. But related concerns linked to the rapid expansion of cities such as congestion, local pollution, and safety also increase when public transport becomes less competitive as a result of poor spatial growth. Rural agricultural land is over-consumed. Cities expand into areas with higher risks of disasters or higher ecological values. Contingent liabilities increase from off-budget borrowing linked to land expansion. And equity concerns arise over the compensation of rural land users on the urban periphery. Reforms in land-use planning, municipal financial frameworks, and changes in spatial development can address these concerns and promote low-carbon growth.

Its proponents, Axel Baeumler, Ede Ijjasz-Vasquez and Shomik Mehndiratta, are three of the authors of  Sustainable Low-Carbon City Development in China, a new book looking at the development of low-carbon cities in China. It is published by the World Bank and is a 500+-page miscellany of urban development projects the Bank has been involved with in China and elsewhere. We suspect it has been somewhat hurriedly assembled so that publication could happen early in China’s current five-year plan, which calls for both continued urbanization and a significant lowering of the country’s carbon intensity. Aimed at city officials, the book is a why and some starter ideas type of book. A second edition promised for a couple of years time is intended to be a more detailed how-to manual.

The first edition doesn’t break much if any new ground. Its value lies in pulling together so many disparate aspects of sustainable urban development that have to be connected for success. For example:

  • Encouraging a cleaner and greener supply of electricity;
  • Continuing the gains of industrial energy efficiency;
  • Promoting residential energy efficiency and building district heating;
  • Better land-use planning and compact city development;
  • Supporting low-carbon transport–walking, cycling, and various forms of public transport;
  • Reducing emissions from private vehicles;
  • Tempering current rates of growth in waste generation, including water and wastewater;
  • Preserving and reusing existing buildings;
  • Promoting urban agriculture and forestry;
  • Developing information and communication technologies, such as smart grids.

If coordinating all those isn’t challenge enough for city officials–and just think of how many ministries, administrations, agencies, departments and offices they cut across–there is also the perennial question of the country’s scale. China is set to add an estimated 350 million residents to its cities over the next 20 years–and that after three decades of unprecedented urbanization, modernization, and economic development. Some 13 million people move from the countryside to the city each year, putting sustained pressure on all forms of public services: energy, water, transport and waste.

At the same time, China has set itself ambitious goals to reduce the carbon and energy intensity of the economy and to transition to low-carbon growth. The current five-year plan, which runs to 2015, sets a target of creating of 45 million jobs in urban areas. It also contains, for the first time, an explicit target to reduce the carbon intensity per unit of China’s GDP. A 17% cut is the goal by the end of 2015, as a milestone on the road to a  40%–45% reduction by 2020.

China’s cities will have to lead the way if these goals are to achieved. They have a sufficiently high degree of autonomy, and, as the authors note, they are “politically, financially, and administratively organized to act quickly and to realize national policy goals”. The true secret to why China’s so-called state capitalism has delivered three decades of double digit economic growth is that its city officials’ career advancement (promotion to a more powerful level of connections) depends on delivering local economic growth. Collectively on a city basis they are given a fairly free hand by central government to create raw GDP growth regardless of the environmental and social cost (up to the point it threatens the Party’s legitimacy to rule). As a market-based incentive it is pretty red in tooth and claw. But it has worked.

If China is to achieve its twin goals of larger but greener cities, it will have to change the incentives dangled before city officials. That, in turn, means dismantling the underlying mechanism that now allows them to work so effectively–the link between land use, finance, and urban sprawl.

Local governments are overdependent on land development for revenue, and particularly on sales of collectively owned rural land to property developers. As a result many Chinese cities have more than doubled their built-up area in no more than 10 years. Changing how cities finance themselves needs to be rethought fundamentally. That means tax reform, better direct access to debt and capital markets for cities, and new ways to facilitate fiscal transfers from higher levels of government.

Bits of that, such as greater municipal bond issuance, are starting to happen. But a lot of stars will have to fall into alignment for it all to come together so the sum of the parts is greater than the whole. A lot of vested interests are challenged. They will have ample opportunity to frustrate the process. Not only will it require new sets of both administrative and market-based incentives to encourage the development of low-carbon cities, with the market-based ones becoming increasingly more important, it will also require an administrative culture that facilitates cooperation across what are now largely independent fiefdoms.

It will also require one more thing. Residents who want to live in more liveable, energy-efficient cities like, and are prepared to be active in creating them.

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Making Electric Vehicles Viable

Since 2009 China has been supporting a large-scale pilot market to promote the development of electric-vehicle manufacturing. Initially in ten cities, this is now extended to 25. Electric vehicles are estimated to become a $250 billion market worldwide within 10 years, accounting for one in ten of new vehicle sales by 2020. China is determined to be a leading supplier to this nascent market, committing $15 billion of government funding to develop its industry. The World Bank has just published an initial assessment of the pilot project, outlining some of the challenges that need to be overcome to make electric vehicles a viable commercial market. The main recommendations:

  • Policy momentum: Purchase price subsidies need to be replaced by support for institutional and technology innovation, vehicle-charging infrastructure and manufacturing capacity.
  • Integrated charging: The recharging infrastructure for buses, trucks and taxis needs to be expanded to accommodate private cars. 
  • Common standards: Common, ideally global standards for charging, safety, and battery disposal are needed for both manufacturers and consumers. State Grid, the largest Chinese utility, has established charging standards, but these differ from U.S. and European standards, inhibiting access to global markets.
  • New business models:  Commercially viability must include the cost of charging infrastructure as the industry cannot rely forever on government funding.
  • Customer acceptance: Consumers will only buy electric vehicles if they think them worth the additional cost. Even when lifetime ownership costs become favorable, the initial price of electric vehicles will still be higher than that of conventional vehicles and have a longer payback period.
  • Greenhouse gas (GHG) benefits: Electric vehicles will have significant low GHG emission potential. Longer term, a large electric vehicle fleet also stands to play a role in grid storage which, combined with renewable energy production, can further reduce GHG emissions.

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Some China Cities Slowly Getting Greener

Urbanization and industrialization is a filthy business. Industry pollutes. More of it just pollutes more. As nation after nation has gone through the industrialization phase of rapid development, each has had to trade-off the benefits of growth and their environmental costs. China is no exception, but it puts great store on being green. We are directed to a new article published by McKinsey & Co., the firm of management consultants, which asks the question, how green are China’s cities. Its answer? The country’s push for sustainable urban development shows mixed results. As a whole, China’s cities don’t meet global benchmarks for sustainability, but things are getting better and there are examples of successes for the laggards to follow.

The article is based on a paper first published last year by a joint team from the firm, Tsinghua University and New York’s Columbia University. Its Urban Sustainability Index uses data from 2004-2008 and covers 112 cities in China. It groups 18 indicators in to five categories, from the provision of basic needs such as clean water to political and policy commitment to sustainability.

The commonalities among the successful cities were “an unwavering focus on industrial restructuring, designing sensible transit systems and green space, pushing improvements through standards, monitoring and pricing, and exploring ways to make industries more resource efficient.” As might be expected, the successes also “displayed a clear, long-standing commitment to achieving their sustainable ‘vision”… “engineered a large degree of cooperation among relevant departments, for instance between those responsible for environmental protection and urban planning”…and “maintained commitment to their overall goals through several changes in leadership”.

The greenest cities do well across all these measures. Some examples: Tianjin has been consolidating heavy industry away from urban centers, a taking advantage of the moves to make fewer but larger new plants more energy efficient. Shenyang has now got almost all its heavy industry out of its center and is redeveloping the brownfields left behind as residential districts. Qingdao, arguably China’s greenest city, has pushed redevelopment projects to follow mass transit routes, increasing bus ridership at the expense of more heavily polluting private vehicles. Kunming is a pioneer in giving buses priority on roads. Nanning has developed  three greenbelts along the Yongjiang river as part of the creation of urban woodlands and green areas to absorb carbon dioxide emissions. Shandong province officials publicly identified the region’s 1,000 biggest polluters and set aggressive waste reduction targets for each of them.

We don’t underestimate the difficulty of implementing green policies, especially in a country where they require considerable coordination between often competing bureaucracies and in which the yardsticks of success against which local officials are measured (and promoted) have been ones of economic growth. Improving the quality of urban life is an objective of the new five-year plan and a high policy priority for the leadership. Gains are being made. The overwhelming majority of the 18 indicators in the Urban Sustainability Index show improvement during the study period. Yet the relatively limited amount of success stories so far among 112 cities also tells its own story.

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