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China Utility-Based Energy Efficiency Finance Program (CHUEE)

Greening China’s Supply Chains


 

Azure International, a Beijing-based consultancy company, and the Renewable Energy and Energy Efficiency Partnership(REEEP), an international nonprofit registered in Austria, organized an award ceremony for "Greening China's Supply Chains: a Blueprint for Optimizing Energy Efficiency in Factories" in Shanghai last June 19.

 

The ceremony focused on an innovative project in China that enables suppliers of international clothing brands to implement energy efficiency improvements in their factories. Thirteen Chinese textile factories supplying to top international brands received recognition for successfully participating in the project, which was developed in partnership between the two co-organizers and several leading international clothing companies.

 

IFC has engaged periodically with Azure, which focuses on clean technology research and advisory services. Recently, IFC shared with Azure on how to engage local partner banks to finance these, and other similar energy efficiency projects. With the project underway, results are starting to show. One factory located in Beijing estimates savings of at least 700 tons of coal per year and about $100,000 on its energy bills. In addition, the Partnership says the project’s likely overall carbon dioxide reduction potential may reach an estimated 60,000 tons per year, with energy savings of about 25 percent of factories’ total energy cost.

 

CHUEE Program Manager Will Beloe spoke at the event. “The partnership should be recognized for the amount it has achieved in less than a year. The projects it has worked on will prove important demonstration cases for the sector to replicate, and we look forward to working further with our colleagues in this partnership to build on this valuable work,” he said.

 

Many international apparel brands source their goods from China. But the factories that make their products have difficulty finding financing for energy efficiency projects because of a lack of available financial data to support investment in energy efficiency improvements.

 

With this new project, suppliers have started to retrofit their premises. As brands increase their presence in this area, it should encourage small and medium enterprises to use the project as a guide to implement their own energy efficiency projects. This will increase sustainable production and allow suppliers to significantly cut costs, allowing for further expansion of energy efficiency financing among small and medium enterprises in China.

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