Growing trend
There are others who have the same focus.
Siemens Industrial Solutions and Services Group, which set up a wastewater
treatment division in China last year, is reportedly in talks with Wuhan Iron
& Steel Group and Shanghai Baosteel Group Corp two leading steel companies
to manage wastewater treatment.
Large refining, micro-electronics, auto and even food producers are potential
industrial customers.
Polluted water in
China's Songhua River heads toward Harbin, the capital of northeastern
Heilongjiang province, November 24, 2005. China has warned local
environmental protection officials that they will be punished if they
allow or cover up damage to the environment in favor of economic growth.
[newsphoto]
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Yili Group, one of China's
largest dairy producers, plans to outsource even though it has the most advanced
wastewater treatment facilities in the country's food industry.
"We plan to outsource this job to a professional wastewater treatment service
provider and will soon hold bidding for the project," says Zhang Jianqiu,
assistant to the president of Yili Group.
"Our core business is making dairy products. There should be somebody who is
much more professional than us to handle wastewater treatment."
His company produces 2,000 tons of wastewater every day but its facilities at
Yili, worth nearly 20 million yuan (US$2.5 million), can treat 10,000 tons of
wastewater daily.
Analysts say the outsourcing trend for wastewater treatment represents
"progress" in the nation's decades-old struggle to curb water pollution.
"It is the right direction," says Fu Tao, director of the Water Policy
Research Centre at Tsinghua University.
"The government used to be the only supervisor for industrial wastewater
treatment, which often led to low efficiency. But now, the companies themselves
can become supervisors when they entrust the job to a contractor."
Industrial enterprises in China used to build and operate their own
wastewater treatment facilities "but now companies can turn over the entire
process designing, building and operation to an independent, specialist firm.
The benefits are lower costs and higher efficiency," Fu says.
Water shortages and pollution are two pressing problems China faces as its
economy develops.
"The next 15 years would be a critical period for urbanization and
industrialization," Fu says. "China could face serious environmental pollution
if no effective measures are taken."
Curbing water pollution is one of the major projects in the 11th Five-Year
(2006-10) Guidelines for National Economic and Social Development. By 2010, 70
per cent of China's urban wastewater should be treated, up from the current 45
per cent, the plan says.
The State Council, China's cabinet, issued a document in December 2005 to
enhance the nation's environmental protection efforts, which reflects the
government's resolve to establish a market mechanism in the wastewater treatment
sector.
A highlight of the document is encouragement for industrial enterprises to
outsource their wastewater treatment to professional contractors through bidding
and tighter supervision.
The document also says that the price of wastewater processing should be
raised to ensure water service providers can "break even and make a small
profit."
Financial allocations by local governments should be available in areas where
wastewater treatment charges are too low.
"Environmental protection should not be just a government campaign," says Jin
Yongxiang, general manager of Dayue Consulting, which specializes in the public
sector.
"The entry of more private investment could bring vigour and efficiency," Jin
says.