A/S McMurray Visits Sites Implementing P2E2

UNCLAS SECTION 01 OF 02 GUANGZHOU 028065 SIPDIS SIPDIS STATE FOR OES/PCI AND EAP/CM USDOC FOR 4420/ITA/MAC/MCQUEEN, DAS LEVINE EPA FOR INTERNATIONAL - CHENG E.O. 12958: N/A TAGS: SENV ENRG CH SUBJECT: A/S McMurray Visits Sites Implementing P2E2 Measures ¶1. (U) SUMMARY: OES A/S McMurray visited two sites in the Pearl River Delta where measures such as those being promoted by the Hong Kong-based pollution prevention and energy efficiency (P2E2) initiative have been implemented -- the Huangpu power plant operated by Guangdong Yuehua Power Company and the Zhujiang Brewery in Guangzhou. At each site, company officials outlined their respective P2E2 efforts and the measurable positive impact these efforts have had on the immediate environment. These companies' efforts serve as a model for the industrial sector, where much more needs to be done by the government and the private sector to adopt pollution prevention and energy efficiency measures. End Summary. HUANGPU POWER PLANT -------------- ¶2. (U) The Huangpu power plant, a state-owned enterprise operated by Guangdong Yuehua Power Co. Ltd, was established in 1975. The plant has four, 125MW oil-fired units and two, 300MW coal-fired units, making it one of the main power generating stations in Guangdong Province with a total generation capacity of 1100MW. ¶3. (U) The plant's General Manager, Mr. Hu Min, outlined the company's efforts to reduce air, water, and solid waste pollution generated by the power plant. According to the "Guangdong Blue Sky Plan," by 2005, the plant was required to install desulfurization equipment on the two coal-fired units to reduce SO2 emissions by 16,770 tons annually. To accomplish this goal, the plant first attempts to control the sulfur content by purchasing low-sulfur content coal and by using desulfurization additives in the oil (Note: the "low-sulfur" sources he mentioned are from Shanxi Province, not low by U.S. standards. End Note.) The plant also began implementing a Wet Limestone/Gypsum Flue Gas Desulfurization project this year. The solid waste (ash) is sold for use in constructing drywall. With these methods, the company hopes to reduce SO2 emissions by a total of 34,000 tons, or over 95% of its total SO2 emissions. The power plant also recycles the waste water used to flush coal dust out of the system. Company representatives stated that they have invested RMB 367 million (USD 45.9 million) in these pollution reduction projects. ¶4. (U) Hu said that the company plans to dismantle the oil- fired generators by the end of the year and build two new coal-fired generators to replace them. These new coal generators would integrate P2E2 measures and have a larger power generation capacity than the four oil-fired units they will replace. ¶5. (U) When asked by the U.S. delegation where the plant purchased its desulfurization equipment, Hu replied that the company initially purchased equipment from the United States, but implied that it now purchases the equipment from German, Japanese, and Chinese companies. ZHUJIANG (PEARL RIVER) BREWERY -------------- ¶6. (U) Zhujiang Brewery was set up in 1985, and since then, production capacity has increased from 50,000 tons to 1.5 million tons. Zhujiang representatives claim that it is now the largest brewery in the world in terms of production, and that Zhujiang Beer is the second best selling beer in China. Zhujiang Beer is known as a "Green Food" (the President of Zhujiang Beer explained that the National Green Food Certification Center sets standards on pesticides, fertilizers, and GMO-free inputs in determining whether a product is designated a "Green Food"). The brewery employs 5,300 workers and operates its own power plant on site. It uses Oracle software throughout the manufacturing and bottling process. The brewery has partnered with the Belgian company Inbev, which provides Zhujiang with technology, capital, equipment, and allows Zhujiang increased access to the international market. In 2005, the brewery realized RMB 300 million (USD 37.5 million) in profits. ¶7. (U) The Zhujiang Brewery draws its water not from the highly polluted Pearl River on whose banks it is situated, but via a pipe from the East River (Dongjiang),the same source tapped for Hong Kong's drinking water. The plant invested RMB 12 million (USD 1.5 million) to develop cross- flow membrane filtration technology that has reduced water GUANGZHOU 00028065 002 OF 002 consumption by 25%. The spent steam recovery project that was put in place in July has saved RMB 3 million (USD 375,000) in production costs. The company also recovers CO2, spent grain, wasted yeast, and glass, saving RMB 15 million (USD 1.9 million) per year. The brewery has installed desulfurization equipment at its power plant, reducing sulfur emissions by 70%. ¶8. (U) The brewery President explained that the environmental protection measures are not only required by the government, but are also driven by its corporate social responsibility, its strategy to reduce costs and increase its competitiveness. In addition, for a growing enterprise like the Zhujiang Brewery, it is critical to make sure that local residents do not have environmental complaints. ¶9. (U) COMMENT: These companies' efforts serve as a model for the industrial sector, where much more needs to be done by the government and the private sector to adopt pollution prevention and energy efficiency measures. MARTIN