A central heating project in nine cities in the northeastern province of Heilongjiang, People's Republic of China (PRC), will use private sector efficiency to warm homes and improve public health.
Residents of Heilongjiang province, an underdeveloped northeasten border in the PRC, will soon be getting respite from the hazardous coal-fired smoke and other air pollutants. ADB is providing $150 million assistance under the Heilongjiang Energy Efficient District Heating Project to expand and upgrade district-heating systems to make them more energy efficient.
"We want the state-owned enterprises to learn and benefit from the good practices of the private sector to increase the viability of the heating business."
-- Teruhisa Oi, ADB Senior Energy Specialist
"Heating service is the one of the basic needs of the province, where the winter temperatures fall down to -40 degrees celsius, and lasts for six months," said ADB Senior Energy Specialist Teruhisa Oi.
Traditionally, poor households use coal stove for heating and cooking in Heilongjiang province. Some well-off people receive heat from a district heating systems but this is small-scale district heating system located in the neighborhood and equipped with heat boilers that burn coal.
"Most of these lack emission control equipment," said Teru. "The burning of coal indoors and outdoors worsen air quality and is a major cause of air pollution and respiratory diseases."
The project is introducing centralized heating system networks that will supply heat from large boilers and energy-efficient combined heat and power plants located away from the neighborhoods. "The project will also remove the small, inefficient and polluting coal-fired boilers and stoves from the neighborhood and homes, which will bring tremendous health benefits," he said.
The Project is targeting poor cities with low district heating coverage. "We will cover an additional 270,000 households without increasing net emission," explained Teru. "This will improve living conditions of the people through adequate and reliable heating services."
Learning from the private sector
Heating service in Heilongjian province is primarily provided by the state. The project is bringing in two private companies to provide the heating service in two cities to encourage private sector participation in the area and to enhance the viability of the heating business. "Private enterprises are strong in financial management, including ensuring profits for the company, and have strong client orientation," Teru said. "We want the state-owned enterprises to learn and benefit from the good practices of the private sector to increase the viability of the heating business."
The project will organize yearly knowledge-sharing sessions between these private companies and the state-owned enterprises to ensure state-owned companies learn from the private sector expertise and experience.
A woman's touch
The project will promote women in employing bill collectors, targeting at least 50% of the heating bill collectors to be women.
"It will also ensure heating assistance to 1,300 poor households headed by women by subsidizing 70% of the heating tariff and waiving off connecting fees," said Teru. "We will also organize energy conservation awareness campaigns targeting women in coordination with women's federations".