Water: Beijing Leads The Way

By China Water Risk 10 September, 2013

Beijing leads way with plans for a RMB500 billion Energy Savings & Environmental Protection industry

On 14 August 2013, a few days after the State Council published its plan to boost one of the Strategic Emerging Industries (SEI): Energy Savings & Environmental Protection, Beijing announced its own plans to hasten wastewater treatment and reuse of water from 2013 to 2015 (click here for the full announcement in Chinese and here for HSBC’s opinion).
Beijing’s plan sets a target of RMB500 billion for the municipality’s Energy Conservation & Environmental Protection Industry by 2015. With the national target for this SEI set at RMB4.5 trillion, the capital is expected to take the lead with over 10% of the industry. (More commentary on the National Plan here)
It is not surprising that Beijing is taking the lead: the average water resources per capita of Beijing from 2003 – 2011 is 145m³, far below the internationally recognised level for water scarcity of 1,000m³. In fact the capital faces extreme water scarcity.
Over the last ten years, Beijing has made many attempts to ensure they have enough water to support urban development. The Beijing News published an article last month with infographics on Beijing water supply & consumption facts: in 2000, the total water consumption was 4 billion m³ but by 2012 this had reduced to 3.6 billion m³. In order to support residential and commercial water consumption as a priority, industrial water consumption has been reduced from 1.05 billion m³ in 2000 to 0.5 billion m³ in 2012 while water used in agriculture has been reduced to below 1 billion m³. In 2012, the residential and commercial water usage was 1.6 billion m³ to support a population of over 20 million.
In addition, the South-to-North Water Diversion project is supposed to provide relief. However, Dai Yuehua, the Director of Water Resources Department in Beijing Water Bureau has said, even this will only add less than 50 m³ of water per capita. Is around 200m³ of water per capita per annum enough? Just to make it easier to visualise, this works out to only 2.7 bathtubs full of water resources per person per day in Beijing. No wonder the capital is keen to employ a mix of water harvesting and savings strategies to “create” more water.

Saving & making more water available

Beijing relies on groundwater. According to data from the 2012 China Statistical Yearbook, groundwater usage accounts for around 60% of water supply compared to surface water supply of 20%. The remaining 20% comes from recycled water. Heavy reliance on groundwater has resulted in over extraction. Back in February 2012, Beijing announced that they will close 800 wells within the 5th ring road in an effort to rein in groundwater usage. According to the First Beijing Water Census published in May 2013, there were 84,748 groundwater abstraction wells in Beijing; 9,917 of these are household wells and around four thousand are abandoned. It is expected that the number of wells in use will be reduced gradually as the South-to-North Water Diversion project comes online.
It now appears that the city is trying to also increase usable surface water which can be achieved by cleaning up the water quality in surface rivers and rain water harvesting.

Cleaner rivers: Beijing started a clean-up plan for over 200 km of rivers within the city and promises her citizens that by the end of this September there will be a dramatic change¹. It is expected to stop illegal discharge (estimated at 280,000 tons of wastewater daily) through stricter monitoring of the chemical, pharmaceutical, textile, food processing and brewing industries. The Beijing Water Bureau announced that 90% of wastewater produced in Beijing will be treated properly by the end of 2015², Beijing city centre will be a priority with water treatment for areas within the 4th Ring Road expected to be at 100% and 5th Ring Road at 98%. The plan also states that existing wastewater treatment plants will be used more efficiently to clean the urban rivers. “The unpleasant smell of the rivers will disappear” said one of the officers.

Rainwater harvesting: In July, Beijing said it will invest RMB 2.12 billion to reconstruct and manage the rainwater harvesting pipelines³. According to Xinhua, planning permission will no longer be granted to new buildings with no rainwater harvesting design/equipment.

Recycling water: The new plan also has an emphasis on recycling water and by 2015, there will be 47 new recycling water treatment plants and an upgrade of 20 existing plants in an effort to turn Grade V+ water (useless for both agri & industrial use) into Grade IV water which could then be used as industrial water. The new plants & plants to be upgraded are split as follows:

More pipes: The new plan also maps out strategies for reinforcing construction of pipelines for transportation of recycled water and collection of wastewater, with 1,121km of new wastewater pipelines, upgrade of 169km of wastewater pipelines and 484km of new pipelines for recycled water. The Beijing Water Supply company has already installed monitoring systems for the water supply pipelines and it is now able to save over 33 million m³ of water annually⁴.

The market expects the above to culminate in key technologies, patents, products and brands held by:

• 10 environmental protection companies with an output value of RMB10 billion; and
• 100 environmental protection companies with an output value of RMB1 billion.

But is this enough when there are already over 2,000 environmental protection companies operating from Beijing with a business income of RMB180 billion?
There was also no mention of flood prevention. Back in July 2012, ^heavy rains in Beijing wreak havoc in the city. According to the Beijing Flood Control and Drought Relief Office, the floods affected 1.602 million people in the city and incurred economic losses amounting to RMB1.64billion. On Weibo bloggers described Tiananmen Square as a lake. With weather experts expecting more rain in the North (see here for Water, Food & Weather: Heading North) surely, it is time to build reservoirs? But then again, we have yet to perfect the art of weather predictions.
Regardless, we do seem to be moving forward with the Beijing government putting in place financing to support the SEI. In July 2013, the Beijing government announced a plan to attract over RMB130 billion of investment from private capital to finance infrastructure projects including waste water treatment. Policy focused banks such as the National Development Bank and Agricultural Development Bank, together with state-owned banks such as Industrial and Commercial Bank of China have agreed over RMB100 billion in loan support for Beijing waste water collection, treatment and recycling.
Interestingly, the new plan also encourages the use of international technology to improve efficiency of water distribution, treatment, new materials and equipment and on-line real time monitoring of the system to improve sewage treatment and recycling water facilities. Could this be an indication of increased foreign participation in these areas?
Perhaps even more encouraging is the push for “rigorous assessment & strengthening of supervision”. Not only will working targets & responsibilities be clearly agreed between the various relevant city and county government departments with appropriate penalties for failure to implement the plan, a “social monitoring system” will be put in place. Social monitoring of the river systems will be two-pronged: (1) the local government will use media such television & radio broadcasting to expose illegal discharge discovered by surprise audits; and (2) the people can report violations via telephone hotlines and weibo. The naming of individuals responsible for the implementation of the plan including the Vice Mayor of Beijing, deputy directors of the Municipal Water Authority, NDRC, Municipal Finance Bureau, City Planning Commission also adds weight to the intent indicated.
So although we have liked to see more on the groundwater front, this is all in all, a good start. We expect to see more news on groundwater monitoring in November (hopefully!) and we certainly expect other municipalities or regions taking Beijing’s lead in fleshing out this new SEI.

¹  https://bj.people.com.cn/n/2013/0822/c82840-19367573.html

²  https://www.jfdaily.com/a/6787453.html

³  https://www.cs.com.cn/ssgs/hyzx/201307/t20130726_4081321_1.html

⁴  https://news.sina.com.cn/o/2013-08-23/025928023395.shtml

Related government announcements:

• For Beijing’s Energy Savings & Environmental Protection Plan Annoucement (Chinese only), click here
• For a summary of new guidelines to boost the energy conservation and environmental protection industries, click here
• For 1st Beijing Water Census, click here 

Further reading:

• Enforcing China’s Planned RMB4.5 trillion Green Economy: Can China achieve its planned RMB4.5trn energy-saving & environmental protection industry? HSBC’s Wai-Shin Chan on incentives, changes in environmental law, more regulatory muscle and what this means for water
• 2011-2013 Water Policies Review – Don’t know what China’s been up to on the waterfront? Check out our summary of key water policies between 2011-2013
• Environmental Law Amendment: 40 Year Set Back? – Will the proposed amendment set back China’s environmental development by forty years? Or will it be shelved?
• Groundwater Crackdown – Hope Springs – The economy slows down but the Chinese government speeds up groundwater crackdown with increased transparency, blacklists at both central and provincial levels