Beijing residents, who get one-fifth of their electricity from Inner Mongolia Autonomous Region, are now likely to have access to a greener kind of electricity - from organically produced methane gas.

The North China's autonomous region, which overtook neighboring Shanxi in August to become the most coal-rich provincial region, has been supplying North China's industrial bases and metropolises like Beijing and Tianjin using large coal-fired power plants.

But another rich resource in the region, cows, is showing a growing promise as a clean source of electricity.

What is also interesting is the green electricity will first come from dairy farms.

Yang Wenjun, president of the largest Chinese milk producer Mengniu Dairy, said in an interview with China Business Weekly that Mengniu's methane gas power generating facility in Hohhot, capital of the autonomous region, came into commercial operation at the end of September.

The facility with a capacity of 1.36 megawatts is able to supply 10 million kilowatt-hours of electricity to the power grid in North China. With equipment and technology from Germany, the project is the most advanced of its kind in the farming industry.

It also became one of 10 eco-friendly technologies in August recommended by the State Forestry Administration and Qiushi Journal, the official magazine of the Central Committee of the Communist Party of China.

Mengniu has invested 45 million yuan into the project so that 3,000 tons of the daily dung from some 10,000 cows on Mengniu's farm in Hohhot can be collected and used for power generation. The material is also used to produce 300,000 tons chemical-free fertilizer for vegetables.

While a typical commercial investment by Mengniu is recovered in five years at most, the methane gas project may take eight years.

"As Chinese companies expand to overseas markets, they not only need to compete with international peers in technology and operation, but also learn from their experience in sustainable development," says Yang, a 20-year dairy industry veteran, who helped Mengniu and Yili, another dairy producer in the same city, to grow to be the top-two players in the Chinese market.

"The later they make this change, the more difficult the change is and the higher costs they will pay, so it is worthwhile to have three more years to recover the investment," said Yang with eloquence, a trademark style of Mengniu leaders, at the Davos World Economic Forum last month in Dalian, Northeast China.

Mengniu is building another methane gas power generating facility in Ma'anshan of East China's Anhui Province, where the dairy giant has about 8,000 cows that produce 1,000 tons of dung a day.

The facility, with an investment of 34 million yuan, is expected to generate 22,000 kilowatt-hours daily.

Yili Group, the largest Chinese dairy producer and former employer of some Mengniu founders and Yang himself, is also building facilities to use methane gas for power generation, which is expected to save 3,000 tons of standard coal of energy consumption a year.

Cows are one of the largest sources of methane emissions, the second largest greenhouse source after carbon dioxide. An adult cow emits 80 to 110 kgs of methane annually. With 1.2 billion cows in the world, their total emissions are very significant, according to the United States Environmental Protection Agency.

In other large farming nations like the US and Australia, the control of greenhouse gas emissions from ruminant animals like cows through more efficient management is of primary importance in agricultural areas.

In China, the focus is primarily on marsh gas, whose major component is methane. With lower technological requirements, utilizing marsh gas has 80 years of history in the nation, but raising the efficiency of farms also is also on the agenda of big dairy firms.

Yang said his company started to build an integrated park in July that will include farming, dairy cows and research facilities, and require an investment of 200 million yuan.

The farm, which has already imported more than 6,000 cows from Australia, also has high quality grass seed from 12 countries, including Australia, Denmark and the US, and equipment from Sweden.

Yang says his company is conducting research on cloning cows and plans to triple the productivity for each cow to 15 tons of milk a year.

He reveals Mengniu is also considering the establishing a research and development (R&D) center next year in another major dairy nation.

"In a flattened world, a company does not necessarily have to build a lab in many locations, but the first overseas center will help Mengniu learn the latest developments in the world as well as increase exchanges and cooperation with international scientists," says Yang.

Currently, Mengniu only spends about 1 percent of its total revenues on R&D. The company booked revenues of 10 billion yuan in the first half, 33 percent higher than the same period one year ago, while profits jumped by 41 percent to 485 million yuan.

(China Daily 10/08/2007 page3)