BEIJING - Many foreign companies want to capitalize from the booming smart grid industry in China by increasing investment and providing technology support and solutions.
The government said it is totally open to the foreign investment in the technology sectors of smart grid industry.
"If a company has advanced new technology, which can be applied in the fast-growing smart grid industry, it will get approval from the government very quickly," said Jiang Kejun, director of Energy Research Institution of the National Development and Reform Commission (NDRC).
The State Grid Corporation of China announced earlier this year that the company will spend more than 300 billion yuan ($45.86 billion) annually in the smart grid industry in the next five years.
Jiang said it will bring huge business opportunities for the companies in the clean and low-carbon power fields.
"We hope we can do more projects in China because our company has much experience in the United States and Europe dealing with the smart grid," said Regis Hourdouillie, worldwide smart grid director of Alstom Grid, a unit of Alstom SA.
The company opened its China Technology Center in Shanghai last month to develop solutions for strong smart grid. The center will also focus on research and development and testing of transmission and energy management.
"We do meet some difficulties in the Asian countries for investment in the smart grid industry, but we are happy that we have a place here at least," said Hourdouillie. "Smart grid industry is so wide that it is not possible for only one country or one company to complete it alone. When you cooperate with others, you will grow bigger and faster."
Although Alstom Grid has already made its first step in the Chinese smart grid market, the strategy analyst of Alstom Grid China, Qiao Yunyun, said he believes the company needs to take the Chinese market more seriously.
"Alstom's smart grid project in China is in a totally new stage, and I often urge my European colleagues to take more action in the industry in China because the market is so big," Qiao said.
Siemens Ltd China, a unit of global powerhouse in electronics and electrical engineering Siemens AG, will take part in the bid for State Grid's charging poles project this year. The company also cooperated with many local governments to develop the micro smart grid for the cities' green goals, aiming at increasing the energy efficiency and reducing the costs.
"Chinese smart grid is an important business for us but it is hard to estimate the investment scale of our company in the country, because it is hard to say how much we can participate in the business," said Zhang Jianhui, chief technology officer of Smart Grid Applications of Siemens Ltd China.
Siemens established business units in Beijing and Shanghai last October for the research and development of smart grid, but the company said the competition is fierce.
Zhang said China is leading the smart grid industry in the world, especially in smart meters technology and charging equipment. The company not only imports foreign technologies and localizes them for the Chinese market, but also exports the Chinese high technology abroad, making the Chinese standards international.
Apart from manufacturers of smart meters and smart grid planning and management providers, some other foreign companies are providing software for the smart grid system in China.
Although the software packages such as utility center developed by Hewlett-Packard Co (HP) may only account for 5 to 15 percent of the total cost of a smart grid project, HP still considers the Chinese smart grid as an important sector and will increase investments in China in the future, according to Roy J. Pratt III, chief technology officer of Energy Industry and Utilities of HP, a US-based multinational information technology corporation.
"We would love to see more clear projects and standards carried out by the Chinese government," said Pratt. "We are encouraged when we communicate with the government and the State Grid."
The company doesn't have a project currently in China, but it will provide product development, testing and evaluation for the State Grid soon.
"It seems to me that Chinese government and State Grid are waiting for collecting more information and then take a big decision. But in my point of view, smart grid is not a one-time event. We should get moving instead of waiting," said Pratt. "It should be approached step by step. Make a decision and test it, then continue the process."
(China Daily 04/13/2011 page14)