BEIJING, PEOPLE'S REPUBLIC OF CHINA — The Asian Development (ADB) is providing a $130 million project loan to help Qingdao in the People’s Republic of China (PRC) tap low carbon power sources for its energy needs, allowing it to slash coal use and provide a potential energy management model for other cities across the country. 

“Qingdao like many cities in the PRC that have large power needs for heating in the cold winter months, suffers from poor air quality because of its heavy reliance on coal-fired energy generation, and it is committed to sharply scale back its use of fossil fuels,” said Teruhisa Oi, an ADB Senior Energy Specialist. “This assistance will help the city adopt a non-coal based energy system and low-temperature heat distribution network that will help lower energy intensity by 40% and carbon intensity by 64% from the averages seen in systems in other parts of the northern PRC.”

Instead of coal, Qingdao will use natural gas, solar, thermal, shallow ground geothermal and waste heat recovered from industrial plants to power its district heating, cooling and power production and distribution systems. The project will install small natural gas boilers, a waste heat recovery system from sewage plants and industries, heat pump systems, a solar heating system, a heat storage system and low-temperature pipelines in 8 locations across the city. These measures will help the city sharply reduce emissions of carbon and pollutants, directly benefiting 420,000 people, through improved air quality, and reduced household spending on heating. 

The project’s smart energy management system also helps avoid the overheating of buildings and substantial energy losses, which are seen with existing coal-based heating systems. The project design, which reflects both national and local government priorities to reduce carbon intensity in urban areas, is expected to provide a model for replication in other cities in the PRC.

The project  also establishes an information-sharing platform, allowing Qingdao to tap the knowledge and experiences of the Swedish Council for District Heating and District Cooling—an international leader in low-carbon, energy efficient heating and cooling technologies, as well as energy policy and regulatory setting. 

Along with ADB’s contribution, the municipal government’s Qingdao Energy Group will provide counterpart support of $133.6 million. The project will run for about 5 years with an estimated completion date of 31 December 2020. 

ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, it is owned by 67 members—48 from the region. In 2014, ADB assistance totaled $22.9 billion, including cofinancing of $9.2 billion.

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