Following OC’s reports on Smart cities in Europe, this blog post is focusing on the development of smart cities in China. In 2014, China published its National New Urbanisation Plan (2014-2020) and Guiding Opinions on Promoting the Sustainable Development of Smart Cities. Since then, approximately 400 cities have been identified for piloting Smart Cities development, with a strong focus on transport, energy and healthcare. In 2020, the total market size of China’s smart cities could reach EUR 25 billion.
1. Smart Transports
With its large population, mobility is a big challenge for China and the transport sector is therefore one of the first sectors to take an intelligent approach, with smart transportation projects undertaken in many cities. Thus, China has many opportunities to offer to European companies with strong expertise in design and planning of smart transportation systems. However, attention has to be paid to the fact that data is at the heart of transport innovation, as highlighted in our report Smart Cities in Europe – The Future of Urban Mobility, which applies also to China.
2. Smart Energy
The demand for raw materials, the fast-growing economy and its large population urge China to find solutions for energy saving, green energies, and optimisation. China is also concerned by its water scarcity crisis. In June 2015, an action plan was drafted to clarify the strategy for the so-called “Internet Plus Energy” and “Smart Energy”. Interesting opportunities exist for European companies willing to enter the market by providing smart energy services – such as energy saving consultation, new energy development, cloud platforms, or big data operation.
3. Smart Healthcare
China is concerned by its aging population and the government undertook some reforms to improve the healthcare system – mainly focused on smart hospitals, regional health systems and family health systems. Opportunities will materialise for companies owning technology and knowledge in the healthcare sector and which demonstrate the ability to integrate a smart project. In particular, China will need know-how in relation to wearable devices, e-commerce platforms, hospital informatisation and social healthcare insurance payments.
4. Ongoing smart cities projects
4.1 Sponge cities
The significant flooding during rainfalls in China led to the development of the concept of “sponge city” as a solution. The main characteristic of a sponge city is that, instead of funnelling rainwater away, it retains it for use within its own boundaries. Eco-sponge cities projects include developing ponds, filtration pools, and wetlands; building permeable roads and public spaces where rain can soak into the ground; and creating rooftop gardens. China’s plan for spongifying its water systems has started with 16 pilot cities, namely Qian’an (Hebei), Baicheng (Jilin), Zhenjiang (Jiangsu), Jiaxing (Zhejiang), Chizhou (Anhui), Xiamen (Fujian), Pingxiang (Jiangxi), Jinan (Shandong), Hebi (Henan), Wuhan (Hubei), Changde (Hunan), Nanning (Guangxi), Chongqing (Chongqing), Suining (Sichuan), Gui’an New Area (Guizhou) and Xixian New Area (Shaanxi). Each city has been offered a central governmental special subsidy of RMB 400 to 600 million (up to EUR 80 million) – depending on their size – to be spent on 3-years projects. Changde, for instance, replaced 15% of its hard-standing with bioswales, ditches filled with native plants that naturally collect and filter rainwater. That water can, then, either be allowed to seep into the soil to replenish the groundwater or be collected in underground cisterns. Such operation will cut its engineering bill for new drains in half.
4.2 Supertall buildings
The large majority of smart building projects ongoing in China aim at the construction of the so-called “supertalls”. These are skyscrapers incorporating smart technologies applied to, among others, transport – to reach the building – and renewable energy. A major project is going to be developed in Wuhan by a UK firm: the Phoenix Towers. These two 1km-high spires will purify air and water and will serve both as commercial centre and as community for people living in their apartments. This is a new concept of smart community, all concentrated in a building. All these major projects will offer great opportunities for EU companies providing services that require know-how not yet present in China, e.g. companies active in IT, renewable energy, real estate and infrastructure, telecoms, transport, etc.