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Developing country experience with eco-industrial parks: a case study of the Tianjin Economic-Technological Development Area in China
Journal of Cleaner Production 18 (2010) 191–199
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Journal of Cleaner Production journal homepage: www.elsevier.com/locate/jclepro
Developing country experience with eco-industrial parks: a case study of the Tianjin Economic-Technological Development Area in China Han Shi a, Marian Chertow a, *, Yuyan Song b a b
Yale School of Forestry & Environmental Studies, 195 Prospect Street, New Haven, CT 06511, United States Nankai University, Tianjin, China
a r t i c l e i n f o
a b s t r a c t
Article history: Received 11 June 2009 Received in revised form 1 October 2009 Accepted 2 October 2009 Available online 25 October 2009
To address the pollution that accompanies rapid industrial growth in China, a National Eco-industrial Park Demonstration Program was launched in 2000. This article provides a case study of the Tianjin Economic-Technological Development Area (TEDA). The emergence of an environmental institution in TEDA is used as a backdrop to assess how TEDA has transformed itself into one of the top three national eco-industrial parks in China. Following two years of field research, a network of 81 inter-firm symbiotic relationships formed in TEDA during the past 16 years were identified involving the utility, automobile, electronics, biotechnology, food and beverage, and resource recovery clusters. The article assesses the environmental benefits of the key symbiotic exchanges in TEDA and summarizes some unique characteristics of EIP progress in a developing country. Ó 2009 Elsevier Ltd. All rights reserved.
Keywords: TEDA Eco-industrial park Industrial symbiosis China Circular economy Industrial ecology
1. Introduction Industrial agglomeration has proven to be vital to the economic growth of developed countries [1], as well as to less-developed ones in East Asia, including China [2]. Industrial agglomeration concentrates economic development and resulting environmental pollution into a geographically confined area such as an industrial estate, presenting both opportunities and challenges for environmentally sustainable industrial development. On the one hand, environmental benefits arise from reduced transportation needs, improved economies of scale for pollution control and disposal facilities, and the potential for better environmental cooperation based on increasing inter-firm communication. On the other hand, the concentration of industrial activities can lead to severe pollution and resource depletion exceeding local ecological carrying capacity, particularly when necessary environmental management systems are not put in place as has sometimes been seen in China [3]. In 2007, 54 national economic and technological development areas (NETDAs) in China, occupying less than half a percent of urban land, absorbed 23 percent of foreign direct investment and accounted for 5 percent of China’s Gross Domestic Product (GDP), 4 percent of its tax revenues, and 15 percent of its international trade
* Corresponding author. Fax: þ203 432 5556. E-mail address: [email protected] (M. Chertow). 0959-6526/$ – see front matter Ó 2009 Elsevier Ltd. All rights reserved. doi:10.1016/j.jclepro.2009.10.002
[4]. In 2005, the energy efficiency of 54 NETDAs stood at 0.65 tons of coal equivalent (tce) per RMB 10,000 of industrial value-added as compared to the national average of 2.59 tce. The land and water productivity of 54 NETDAs was also much higher than the national average [5]. Chinese decision-makers and researchers were first exposed to the eco-industrial park (EIP) concept by the United Nations Environment Programme (UNEP) through its publication in Chinese in 1997 of Industry and Environment addressing the environmental management of industrial estates. Because an EIP strives simultaneously to increase industrial growth while reducing pollution and waste [6], the economic and environmental win-win potential of the EIP approach quickly drew the attention of Chinese environmental policy-makers [7]. During the 1990s, while resource-poor Chinese environmental authorities were waging an uphill battle against rampant noncompliance at the enterprise-level, they turned increasingly to flexible environmental policy tools, such as voluntary instruments, to pursue environmental protection at the industrial park and regional levels [8]. Against this backdrop, the State Environmental Protection Administration (SEPA),1 the national environmental
1 The State Environmental Protection Administration (SEPA) was raised to executive branch status as the Ministry of Environmental Protection, thus replacing SEPA, by action of the March 2008 National People’s Congress in Beijing.
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watchdog, launched an industrial park-wide ISO 14001 demonstration program in 1999 and an eco-industrial park demonstration program in 2000. Around this time, a number of countries embarked on deliberate attempts to develop eco-industrial parks (EIPs) to enhance business competitiveness while reducing resource consumption and mitigating environmental pollution through a systems approach to cycling of critical resources [9]. 2. Literature review A defining feature of EIPs is the formation of inter-firm industrial symbiosis (IS), described as ‘‘engaging traditionally separate industries in a collective approach to competitive advantage involving physical exchange of materials, energy, water, and byproducts. The keys to industrial symbiosis are collaboration and the synergistic possibilities offered by geographic proximity’’ [10]. In recent years a growing body of literature examining EIP/IS practice arose in North America [11–13], Europe [14–17] and Australia [18,19]. More recently, there are a few articles on Korean EIP development [20,21] and Singaporean experience in applying ecosystem concepts to the planning of a petrochemical complex [22]. The literature has gradually broadened from individual EIP case studies, to systematic assessment and comparison of national EIP programs, and to early attempts in industrial symbiosis theory construction [23,24]. The quantitative assessment of the economic and environmental impacts of industrial symbiotic activities has remained challenging and scant. Chertow and Lombardi [25] compare the economic and environmental savings resulting from the symbiotic activities against alternatives, such as previous practices or hypothetical alternatives for the firms involved. Social benefits have not typically been measured [26]. Cohen-Rosenthal [27] calls for incorporating job creation and quality of life concerns in industrial ecology research and Kurup et al. [28] have attempted to use triple bottom line indicators for including social benefits. Although the EIP concept has been actively promoted by international organizations and national governments in some developing countries such as China, Thailand, Philippines and India [29], there remains limited empirical literature on the overall experience. For example, Singhal and Kapur [30] examine the relevance of industrial symbiosis and carrying capacity concepts and propose an integrated approach towards IE planning in India. Since China launched the national EIP demonstration program in 2000, SEPA approved 24 industrial parks as the National Trial EIPs as of December 2007. Nevertheless, China’s practice in ecoindustrial parks remains very much unknown internationally. One notable exception is the Guitang Group, a sugar-refining industrial complex which, over the past four decades, has continuously expanded beyond sugar refining into pulp and paper, alcohol, and fertilizer production by utilizing the two key by-product streams from sugar cane production: molasses, the sugar refining residue; and bagasse, the fibrous waste product [31,32]. On the policy side, Geng et al. [33] examined China’s experience in setting up a new national standard for evaluating the performance of EIPs, the first of its kind globally. It calls for better incorporation of the principles of eco-industrial development and local realities in the future refinement of EIP indicators. This article contributes to the sustainable industrial development literature in several ways. First, it elucidates how the Tianjin Economic-Technological Development Area (TEDA), one of three national demonstration EIPs in China, evolved to form a complex industrial symbiosis network in a mixed industrial park. Second, it examines the features and patterns of existing and discontinued IS exchanges both quantitatively and qualitatively as well as examining the environmental impacts of such IS exchanges in relation to
regional resource use limits. Third, the article summarizes some unique characteristics of EIP growth in a developing country. 3. Materials and methods Tianjin Economic-Technological Development Area (TEDA) was founded in December 1984 as one of the first 14 national economic development zones in China. TEDA is located 45 kilometers east of Tianjin downtown and 130 kilometers southeast of Beijing city with a coastal area of 33 km2 facing the Bohai Bay (see Fig. 1). By all standards, TEDA is a large and multi-faceted industrial area, which, like so many other Chinese business developments, includes both industrial and commercial/residential areas. As of 2007, the total built up area of TEDA reached 45 square kilometers, of which the industrial zone accounted for 34 square kilometers and the residential area for approximately 11 square kilometers (TEDA 2008). With respect to materials and methods used in this study, the focus was exclusively on the 34-kilometer industrial zone. The research was based on a thorough literature review of government documents and other background materials concerning TEDA’s overall development, environmental management, and EIP planning and implementation processes. From May 2006 through June 2008, field trips and interviews of 42 companies located in TEDA were conducted to explore and verify existing industrial symbiotic relationships, and 18 recycling and waste management companies were investigated which handle and dispose of the wastes generated from TEDA companies. Further, 15 governmental officials and 6 researchers involved in the TEDA EIP planning and implementation process were interviewed. To approach the question of the relative interdependencies in TEDA, data were gathered to categorize the types of symbiotic exchanges, the average distances between the partners, and whether the location of the exchange partners was or was not within the boundaries of TEDA. As geographic proximity is a hallmark of symbiotic exchanges, we have paid special attention to ascertain the distances between respective symbiotic partners by using several Internet-based maps such as http://ditu.google.cn/. For those exchange partners that could not be located through the electronic maps, we directly consulted company managers about the approximate transportation distances. We adopted the administrative boundaries of TEDA as the system boundary of our research. 4. Evolution of TEDA When TEDA was first created on a salt pan in 1984, the only economic activity was salt-making and industrial output value was 2 million yuan [34]. Among the earliest foreign investment companies were Danhua Bicycle, Jingtai Porcelain and Wella Cosmetics. As of December 2007, TEDA had registered 4485 foreign investment enterprises with a total cumulative investment of US$ 40 billion since 1984. Among the Fortune 500, 62 multinational corporations established 137 enterprises in TEDA2. Meanwhile, 9527 domestic enterprises were registered at TEDA with aggregate registered capital exceeding RMB 60 billion yuan. Of the domestic companies, 7547 companies were privately owned with a total registered capital of RMB 26.33 billion yuan [35]. In 2008, the gross industrial output value for TEDA totaled 373 billion yuan [36]. TEDA has been ranked as the most attractive economic development zone for foreign investment by China’s Ministry of Commerce for 10 consecutive years from 1998 to 2007 [4].
2 Source: Official website of TEDA investment service (www.investteda.org/qygl/ ysjs/jjys).
H. Shi et al. / Journal of Cleaner Production 18 (2010) 191–199
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Fig. 1. Geographic location and zoning of TEDA.
Four ‘‘pillar industries’’ have evolved to be most significant in TEDA. These are electronics, automobile & machinery, biotechnology & pharmaceutical, and food & beverage industries contributing a gross industrial output value of RMB 308 billion. Breaking this down, electronics accounted for 49%, automobile & machinery for 32%, biotechnology & pharmaceuticals for 6%, and food & beverage sectors for 4%, of gross industrial output values in 2007. Electronics. There were very few companies producing electronic products in TEDA before 1992. Motorola’s investment in 1992
changed TEDA’s trajectory. Beginning in 1995, Samsung Group also started to produce monitors, digital cameras, DVDs, cell phones and other electronic products in TEDA. In 1997, the industrial output value of the electronics industry reached 20.34 billion yuan, accounting for 56.2 percent of the gross industrial output value of TEDA. Since then, the electronic industry has continued to grow and remained the largest industry at TEDA (see Fig. 2). Machinery and Automobiles. A German company called SEWEurodrive started to invest in the machinery sector in TEDA in 1995.
Fig. 2. Change in gross industrial output values of the four pillar industries in TEDA.
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Toyota Motors and Chinese leading auto-maker FAW decided to invest jointly in auto-making facilities in 2000, signifying a milestone for this industry of TEDA. The automobile industry cluster has grown rapidly since then. Biotechnology and Pharmaceuticals. A world leader in biotechnology, Denmark’s Novo Nordisk, started to invest in TEDA in 1994. Other major biotech and pharmaceutical companies include GSK and Servier. Currently, Novozymes (China) Biotechnology Co., Ltd., a spin-off company from Novo Nordisk located in TEDA, has become one of the three strategic production bases of Novozymes Group worldwide. Food and Beverage. A Taiwanese-back company called Tianjin Tingyi International Food Co., Ltd. started to produce instant noodles in 1992. Between 1992 and 1996, Tingyi continued to establish ten more companies to produce and package beverages and confections as well as to supply packaging materials, starch products, oil and fat products, and food production machinery. Tingyi rapidly grew to be the market leader in instant noodles, ready-to-drink teas, and sandwich crackers in China [37]. Apart from Tingyi, Coca-Cola, Nestle, Kraft, and Pepsi have also established their production facilities at TEDA.
Table 1 Timeline of environmental institution development at TEDA. Year
Main developments
1984 1990
TEDA created. TEDA established its own Environmental Protection Bureau (EPB). TEDA Environmental Protection Association was established among companies. Motorola obtained the first ISO 14001 certification at TEDA. TEDA was ISO 14001 certified. SEPA nominated TEDA as a national demonstration zone for ISO 14001. TEDA started to make public its annual environmental report for 2000. The strategic goal of pursuing an EIP was put forward by TEDA. TEDA signed the International Declaration on Cleaner Production. TEDA started to formulate an EIP development plan. A leading group for developing TEDA into a national pilot EIP was formed. The TEDA EIP development plan was approved. SEPA nominated TEDA as a National Trial EIP. TEDA Waste Minimization Club was established. A logo management system of industrial solid waste was launched in TEDA. NDRC nominated TEDA as a national pilot industrial zone for demonstrating circular economy. The TEDA Committee for Promoting the Circular Economy was established. The TEDA Circular Economy Promotion Center was established. The Provisional Management Methods of CE were promulgated. The Ministries of Environmental Protection, Commerce, and Science and Technology nominated TEDA as one of the first three National Demonstration EIPs.
1996 1998 2000 2000 2001 2001 2002 2002 2003 2003 2004 2004 2005 2005
5. Evolution of an environmental institution in TEDA
2005
Following its establishment in 1984, TEDA was the first national economic-technological development area to create an independent environmental regulatory body, when, in 1990, management created the TEDA Environmental Protection Bureau (EPB). From 1990 on, TEDA EPB has continued to upgrade its environmental management capacity and install new environmental programs such as environmental impact assessment of new investment projects, environmental monitoring of existing key water and air pollution sources, pollution discharge levies, total pollutant emission control, and other initiatives. Table 1 provides a chronological development of environmental management initiatives at TEDA. In 1999, the State Environmental Protection Administration (SEPA) circulated a policy opinion to encourage the national industrial, high-tech, and tourism development zones to establish park-wide ISO 14001-conforming environmental management systems and join the National ISO 14001 Demonstration Zone Program. At the national level, Suzhou New District became the first industrial estate awarded an ISO 14001 certification in September 1999 [38]. In strategic terms, TEDA continuously faced fierce competition for foreign investment from other frontrunner national industrial development zones in Suzhou, Dalian, and Guangzhou. Consequently, TEDA management decided to pursue any measures that would contribute to consolidating its leadership status among national economic development areas. Thus, the TEDA Administrative Commission, the government authority in charge of the daily operation of TEDA, decided that obtaining an ISO 14001 certification for the entire industrial estate not only would elevate the environmental management capacity to a whole new level, but also would enhance the investment climate and public image internationally [39]. TEDA was granted both ISO 14001 certification in November 2000, and designation by SEPA as one of the National ISO 14001 Demonstration Zones in the same year. Table 2 identifies many other environmental management activities that followed, responding in part to directives and in part to competitive pressures. In 2005 TEDA was chosen as a national pilot industrial zone for demonstrating the circular economy development model by the National Development and Reform Commission. In 2008 TEDA was nominated to be one of the first three National Demonstration Ecoindustrial Parks jointly by the Ministries of Environmental Protection, Commerce, and Science and Technology.
2006 2007 2008
Source: Compiled from various sources.
6. TEDA, industrial symbiosis, and public infrastructure Given that the land for TEDA was saline, topsoil and soil conditioning materials have always been in great demand to be able to prepare it for industrial and residential development. Actually, land development in TEDA led to severe farmland degradation in nearby rural areas as a great amount of topsoil was moved to the industrial area. Water resources are transmitted from a reservoir 52 kilometers away and are in acute shortage. At present, TEDA only extracts some groundwater to supply as hot Table 2 Timeline of development of key environmental infrastructure at TEDA. Year
Main activities
1987 1987 1995 1998 2000 2001
First co-generation power station was put into operation. TEDA Landscaping Development Co. established. TEDA Water Treatment Plant (Phase 1) became operational. TEDA Water Treatment Plant (Phase 2) established. TEDA Wastewater Treatment Plant was put into operation. An electroplating wastewater treatment facility started operation. A flue gas desulphurization system was installed in one thermal power station. The Hangu Domestic Garbage Landfill started operation. The TEDA Water Reclamation Plant (Phase 1) was put into use. Tianjin Hazardous Waste Treatment & Disposal Center commenced operation. A new fluidized bed combustion co-generation power station was put into operation. Tianjin Shuanggang Waste-to-Energy Plant was placed in trial operation. The Binhai Rapid Mass Transit System was put into trial operation. The first sea water desalination plant was put into trial operation. Taiding Environmental Technology started to operate as a regional E-waste recycling hub.
2002 2002 2003 2003 2003 2004 2004 2007 2007
Compiled from various sources.
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water for industrial and commercial use. The excessive scarcity of both water and usable land has driven TEDA to conserve and make very efficient use of these critical natural resources since the early 1990s. Subsequently, numerous industrial symbiosis activities involving energy, materials, and water were developed involving the public infrastructure system with key milestones over 20 years reviewed in Table 2 and some highlights discussed below. Public Utilities – Water/Steam/Energy. Sharing of public utilities and environmental infrastructure is an important hallmark of Chinese EIPs as it is essential to provide high quality and low cost utility and infrastructure services to companies to woo their investments in the first place (see Fig. 3). Along these lines, the Tianjin TEDA Water Technologies Co., Ltd. started to build the first water reclamation plant in 2000. The facility uses the effluent of the TEDA Sewage Treatment Plant as input and adopts continuous micro-filtration (CMF) pretreatment and then a reverse osmosis (RO) process for deionization. In 2006, 1.43 million tons of ROtreated reclaimed water was supplied for industrial processes and 2.35 million tons of CMF-processed water was used for recharging an artificial wetland and for landscaping. Major industrial users of reclaimed water are Tianjin Binhai Energy and Development Co., Tianjin FAW-Toyota Motors Co., SEW- Eurodrive, and TEDA Ecolandscaping Development Co. In Chinese industrial parks, co-generation that is primarily aimed to supply steam is the norm rather than the exception. Four out of the five thermal power plants in TEDA are coal-fired, supplying steam and hot water for users in TEDA. To supplement a shortage in the process steam supply for TEDA, Tianjin Soda Plant began supplying steam to TEDA in 2001. In addition, Tianjin Binhai Energy and Development Co. started to recycle condensate from large steam users such as an automobile manufacturer. TEDA also established a pilot desalination facility with a treatment capacity of 10,000 cubic meters per day for phase 1 by using the low-pressure steam from the neighboring thermal power station. In addition, the TEDA Thermal Power Plant consumed 182,777 tons of double RO water as boiler supply water in 2006 [40].
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Public utilities - water cascading, landscaping, soil creation: In 1997, the TEDA Eco-landscaping Development Co. Ltd. developed an innovative technology to produce new soil out of three solid wastes: Bohai Sea sediments, caustic soda sludge, and fly ash from the TEDA Thermal Power Plants. The initiative considerably reduced the destruction of topsoil from neighboring farmland and conserved a significant amount of farmland in the 1990s. New soil sources, however, are no longer cost competitive because of the increasing prices paid since the late 1990s for the coal fly ash and sea sediments for even higher value uses. Public utilities - solid waste: TEDA’s Shuanggang Municipal Waste Energy-Recovery Incinerator began operation in 2004, converting about 400,000 tons per year of municipal solid waste into 120 GWh. It also makes floor tiles out of its bottom ash as well as haydite – a light weight aggregate - from its fly ash which is characterized as a hazardous waste. Tianjin Hejia Veolia Environmental Services Co., Ltd. invests in and operates the Tianjin Hazardous Waste Treatment and Disposal Center (THWTDC), which commenced operation in 2003. Apart from physicochemical treatment, secure landfill and incineration of hazardous waste, THWTDC also began to clean/recycle solvent drums in 2006 and began solvent recovery in 2007. Industrial exchanges: In addition to the public infrastructure, since the mid-1990s, a series of industrial symbiosis activities involving energy and water cascading and solid waste exchanges gradually emerged among the four pillar industries (electronics, machinery and automobile, biomedicine, and food & beverage sectors). These are summarized below. Electronics cluster: In addition to traditional waste minimization and recycling practices, several companies started to recycle spent lead solder materials including Motorola (China), Tianjin Samsung Electronics Co., Ltd., General Semiconductor (China) Co., Ltd., and Tianjin Fujitsu Ten Electronics Co., Ltd. Reuse and recycling of CRT glass, waste oil, and silver extracted from electroplating residues are other examples of materials encompassed in interfirm exchanges.
Fig. 3. Symbiotic exchanges associated with the public utility sector.
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Food and beverage cluster: In 1992 Tianjin Tingyi International Food Co., Ltd. started to sell its flour scraps from instant noodle production to nearby pig farms as pig feed. This represented the first symbiotic relationship formed at TEDA. Later on, Tianjin Nestle Co., Ltd., Kraft Tianmei Food Co., Ltd., and Tianjin Tingyuan Food Co., Ltd. also sold their food scraps as animal feed to neighboring farms. In addition, Tianjin Tingfung Starch Development Co. Ltd. supplies its starch scrap to a local coal briquette factory to produce coal briquette. Chia Tai (Tianjin) Industrial Co., Ltd. sells soybean residues to Tianjin Chia Tai Feeds Technological Co., Ltd, fatty acid and lecithin to food producers. Biotechnology & pharmaceutical cluster: In 1998 Novozymes (China) Biotechnology Co. Ltd. began production of a wide range of liquid and granulated enzymes in TEDA, one of three globally strategic production sites for the Danish company. The TEDA facility’s bulk production waste – the spent biomass containing high levels of nitrogen, phosphorous, potassium, and other organic matter – has been converted into a solid organic fertilizer called NovoGroÒ30 with a dry matter content of 30%. Novozymes (China) supplies about 20,000 tons of NovoGroÒ30 annually for TEDA land reclamation and farmland fertilization free of charge. Since 2000, Novozymes has supplied its treated industrial effluent for irrigating greenery by the TEDA Eco-landscaping Development Company and since 2002, for road cleaning/maintenance by the TEDA Public Works Company. Automobile & machinery cluster: The burgeoning automotive and machinery cluster primarily consists of the closed loop recycling of scrap galvanized sheets and aluminum in the Toyota auto making facilities as well as the closed-loop lead recycling between Tianjin Tong Yee Industrial Co., Ltd. and Tianjin TOHO Lead Recycling Co., Ltd. (see Fig. 4). Tianjin Toyotsu Resource Management Co., Ltd. has annual scrap recycling capacity greater than 60,000 tons. In late 2006, Tianjin Toyotsu Aluminum Smelting Technology Co., Ltd started to produce molten aluminum for the neighboring Tianjin FAW Toyota Engine Co., Ltd. from locally produced aluminum scrap supplemented by imported aluminum scrap. Tianjin TOHO Lead Recycling Co., Ltd, established in 2005, is the first environmentally sound recycler3 of used lead-acid batteries and other lead waste in the Tianjin and Beijing region. Tianjin TOHO recycles the scrap lead generated from lead-acid battery manufacturing at Tianjin Tong Yee Industrial Co., Ltd., lead waste from other enterprises such as Motorola (China), and used lead-acid batteries from the Tianjin and Beijing regions (see Fig. 4). Several other sectors are involved with symbiotic exchanges including furniture scrap for fuel and plywood, printing and packing waste and paper scraps sent to a paper mill, and gypsum scraps from pottery sold to a nearby cement mill.
7. Results Following two years of field research, 81 symbiotic exchanges were identified, overall, as having been formed in TEDA. Of these, 70 are currently functioning and 11 have been discontinued as discussed below. This finding indicates that a complex adaptive industrial symbiosis network has taken shape in TEDA since it was first established from scratch in 1984. To provide a sense of the total quantity of resources exchanged, the following figures show significant although still incomplete results achieved in 2006:
3 The lead recycling facility is among a few national certified environmentally sound lead recycling facilities.
1.26 million cubic meters of reclaimed water purchased by industrial users; 1.35 million cubic meters of tertiary treatment effluent used for recharging the local water bodies; 182,777 cubic meters of double Reverse Osmosis reclaimed water used for substituting the boiler supply water of a CHP power plant; Over 400,000 tons of municipal solid waste and 25,000 tons of straw incinerated to produce 120 GWh of electricity; 5115 tons of lead waste recycled into 3094 tons of lead alloy; 98591 tons of fly ash and bottom ash used in construction projects and landscaping; 23,193 tons of NovoGro used as fertilizer in nearby greenery, orchards and farms; More than 12,000 tons of scrap galvanized plates recycled as raw materials and auto moulds for auto making at TEDA; More than 2000 tons of wood scraps used for plywood production and 8700 tons of wood scraps used as fuel to substitute natural gas; 2200 tons of new paper scrap and over 4100 tons of new cardboard scrap recycled; 16 tons of spent lead-containing electronic solder recycled for solder materials; More than 3700 tons of food wastes made into animal feed; 900 tons of rubber scraps made into other rubber products; 800 tons of plastic scraps recycled into plastic pellets; 1400 tons of sludge and almost 1100 tons of gypsum scrap employed as cement raw materials; 800 tons of used resin reused in road construction. Within the total of 81 exchanges, energy exchanges account for 9%, water exchanges account for 15%, and material-based exchanges account for 76 percent. The average distance between energy-related symbiotic exchanges is 2.9 km, shorter than the average distance of water-related symbiotic exchanges (3.5 km), and in turn much shorter than the one for material-related symbiotic exchanges (28.2 km). This is strong evidence that energy and water related symbiotic exchanges are more sensitive to geographic distance than material-based symbioses. We further break down the existing 81 symbiotic exchanges into two categories: internal-internal (I-I) and internal-external (I-E) type (see Table 3). The 33 I-I type symbioses represent the symbiotic exchanges formed between two companies located within the boundaries of TEDA. The 48 I-E symbioses represent symbiotic exchanges formed between one company located within TEDA and one outside TEDA’s boundaries. Water-related IS exchanges only exist within the boundary of TEDA. For I-E symbiotic exchanges, 46 of 48 are material-based while 2 are energy based. It is worth noting that over 59 percent of IS exchanges are formed beyond the boundary of TEDA. As geographic proximity is a hallmark of industrial symbiosis, we particularly examine the average distances of energy, water and material-based exchanges of both I-I and I-E type symbiosis (see Tables 4 and 5). It is clearly shown that the average distance, 11.5 km, of the I-I type material-based symbioses is much shorter than the 34 km average distance of the I-E type material-based symbioses. A systemic assessment of the emergence of IS exchanges in TEDA is illustrated in Fig. 5. The development of 7 energy-based synergies is quite evenly spread over the period, while the 12 water-based exchanges are concentrated more during the development of park-wide water reclamation and sea water desalinization systems since 1999. As noted above, 11 IS exchanges of the 81 identified were discontinued during the period examined. Some scholars express their
H. Shi et al. / Journal of Cleaner Production 18 (2010) 191–199
concern with the negative implication of the so-called ‘‘lock-in’’ effect of industrial symbiosis [41,42] for the sustainability of industrial ecosystems. To shed some new light on this issue, each IS exchange that first became established, but later fell apart is examined. The primary reasons for discontinuance are based on changing circumstances which are a characteristic of any business or market activity as follows: 1. Cleaner production: in 6 of 11 cases, cleaner production, which substantially reduces waste generation in the first instance, created the modification that led to the discontinuance of symbiotic exchanges. In the case of a major food producer, for three years the company supplied its treated effluent to a local landscaping firm for landscaping purposes. When the food producer increased in-plant water reuse, there was not enough water for external reuse and this exchange terminated. A large electronics manufacturer redesigned its packaging to gain substantial reduction of paperboard rather than recycling. Another phased out the use of trichloroethylene solvent (TCE) rather than continue to recover it. 2. Prices: in two cases, exchanges were made unfeasible because of increasing prices. In one case this caused a by-product to increase in value and was no longer available for within-park use. In another instance, the high price of steam made the operation of the pilot desalination plant economically uncompetitive and its operation was discontinued. 3. Environmental liability concerns: in two cases concern over liability drove waste generators toward more conventional waste disposal. 4. Bankruptcy: the suspension of production of a food processing plant led to the breakdown of IS exchanges associated with the firm.
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Table 3 Summary of all symbiotic exchanges identified in TEDA as of 2008. Resource exchanged
I-I symbiosis
I-E symbiosis
Subtotal (%)
Average distance (km)
Energy Water Material Subtotal
5 12 16 33
2 0 46 48
7 (8.7%) 12 (14.8%) 62 (76.5%) 81 (100%)
2.9 3.5 28.2
Note: I-I ¼ Internal vs. internal, I-E ¼ Internal vs. external.
8. Discussion and conclusion This paper provides a detailed examination of the development of TEDA, a mixed-industry industrial park with the subsidiaries of more than 60 non-Chinese Fortune 500 companies, into an EIP in China. TEDA has shown several special features on the path to becoming an EIP. First, TEDA itself was established as a result of experimentation within China’s reform policy, thus institutional innovation has been built into the DNA of TEDA with TEDA management eager to learn and implement international best practices. Second, TEDA is pro-business and responsive to business requirements. A number of multinational corporations have introduced to TEDA sustainable production practices that were implemented in other countries. Third, TEDA is very sensitive to competition and has tried its best to maintain its leading position in China as an industrial park in the face of the heated struggle for foreign direct investment triggered by the Asian financial crisis in 1998 and subsequently China’s accession to the World Trade Organization in 2001. The development model for TEDA and most Chinese industrial parks is to provide low-priced, high quality infrastructure services
Fig. 4. Symbiotic exchanges associated with the automobile industry.
H. Shi et al. / Journal of Cleaner Production 18 (2010) 191–199
Table 4 Distances of type I-I symbioses of TEDA. Stdev
0.1 0.1 0.1
5 8 35
2.7 3.5 11.5
2.4 3.1 11.8
Note: all units are in kilometers.
to tenants subsidized by general local tax revenues in much the same way that a local government does. This model makes it possible for TEDA to implement some infrastructure-related investment initiatives which may not be financially feasible especially in the early stages, but result in an environmental benefit. The water reclamation system in TEDA, for instance, is heavily subsidized. Without the cross-subsidization to various infrastructure services by the TEDA Administrative Commission, it is unlikely that TEDA could have implemented a number of environmentally benign infrastructure projects such as a centralized electroplating wastewater treatment facility and a sea water desalination facility. Still, the TEDA Administrative Commission has been much leaner and more streamlined than most Chinese local governments allowing for more effective coordination and cooperation among different administrative divisions. With respect to innovation, TEDA has succeeded in developing critical technologies supportive of symbiotic exchanges such as a regional water reclamation system and new soil sources from soda slag and coal-fired bottom ash with the support of the national government. To enhance technological innovation for eco-industrial park development, the TEDA Administrative Commission has stepped up its financial support for R&D activities on critical technologies. Examples include condensate reuse, composting of traditional Chinese medicine slag, and environmentally sound disposal of fly and bottom ash from the municipal waste incineration plant. Weak technological innovation capacity within many companies located in TEDA, however, has proven to be a great hurdle for technological advancement, especially because waste reuse and recycling is not a core business activity for these firms. To overcome the bottleneck, it is vital to strengthen the partnership with external innovation centers. Another useful approach is to sensitize decision-makers in the TEDA Administrative Commission and many companies about the need for environmental innovation as the focus has mostly been on core product/process innovation. Cleaner production or pollution prevention at the firm level plays a more prominent role in the development of EIPs in China compared with the EIP initiatives in industrialized countries. Even for those subsidiaries of multinationals operating at TEDA, there is still considerable room for implementing cleaner production [43]. This need has been emphasized by both Chinese scholars [44] and international researchers [45,9]. There are occasional conflicts, however, between cleaner production and inter-firm exchange. Successful efforts in cleaner production may substantially reduce and even eliminate the waste to be exchanged in the first place. A representative example is that Tianjin Tong Yee Industry Co.’s lead production waste had been greatly reduced as a result of effective pollution prevention measures in the workshops in response to skyrocketing lead prices from 2006–2007. As
Table 5 Distances of type I-E symbioses of TEDA.
Energy Material
Min
Max
Mean
Stdev
0.6 0.8
6 232
3.3 34.0
3.9 34.5
Note: all units are in kilometers.
Energy
Material
12 10 8 6 4 2 0 88 19 89 19 90 19 91 19 92 19 93 19 94 19 95 19 96 19 97 19 98 19 99 20 00 20 10 20 20 20 03 20 04 20 05 20 06 20 07
Mean
87
Max
Number of new IS exchanges
Water
Min
19
Energy Water Material
14
19
198
Fig. 5. Evolution of symbiotic exchanges in TEDA.
a result, the change imposed significant pressure on a local lead recycling facility to secure adequate raw materials from others for its operation. The earliest symbiotic relationships were formed spontaneously across industrial companies. They were initiated primarily for economic cost-saving reasons while their environmental benefits tended to be little recognized. More than 50 percent of the IS relationships are formed between companies in TEDA and firms outside TEDA; thus, the boundaries of industrial parks have not confined the development of industrial symbiosis among companies. There is a clear trend for the key electronics and automotive companies to outsource the lowest value-added and often pollution-intensive production of intermediate components and materials such as electroplating to outside industrial parks. In the long run, the environmental performance of EIPs should take into consideration the spillover effects beyond the boundary of an industrial park. Coordination across key stakeholders and information dissemination have proven to be crucial to the development of industrial symbiosis, the backbone of an eco-industrial park. In the case of TEDA, the TEDA Environmental Protection Bureau has played a leading role and external technical expertise has been actively sought to assist the development processes. The TEDA Administrative Commission has also played a strong role through public policies, in particular in the form of subsidies, which have promoted industrial symbiosis, cleaner production, and proper waste disposal at the plant level. It has been shown that economic feasibility remains one of the decisive factors for the sustainability of industrial symbiosis relationships. A number of prior symbiotic exchanges were discontinued because of inadequate economic feasibility triggered by a change in byproduct prices. Public policies, therefore, could be geared toward adjusting the basic economics of the IS activities to recognize and reward their positive environmental externalities rather than to establish IS exchanges themselves.
Acknowledgements We acknowledge that the research was impossible without the full cooperation and support from WEI Hongmei, YAN Xu, DING Ting, and WANG Huizhen of the TEDA Environmental Protection Bureau. We also acknowledge the financial support from the McMillan Center for International and Area Studies and the Yale Program on Industrial Ecology in Development Countries. We take full responsibility for any remaining errors.
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Contents lists available at ScienceDirect
Journal of Cleaner Production journal homepage: www.elsevier.com/locate/jclepro
Developing country experience with eco-industrial parks: a case study of the Tianjin Economic-Technological Development Area in China Han Shi a, Marian Chertow a, *, Yuyan Song b a b
Yale School of Forestry & Environmental Studies, 195 Prospect Street, New Haven, CT 06511, United States Nankai University, Tianjin, China
a r t i c l e i n f o
a b s t r a c t
Article history: Received 11 June 2009 Received in revised form 1 October 2009 Accepted 2 October 2009 Available online 25 October 2009
To address the pollution that accompanies rapid industrial growth in China, a National Eco-industrial Park Demonstration Program was launched in 2000. This article provides a case study of the Tianjin Economic-Technological Development Area (TEDA). The emergence of an environmental institution in TEDA is used as a backdrop to assess how TEDA has transformed itself into one of the top three national eco-industrial parks in China. Following two years of field research, a network of 81 inter-firm symbiotic relationships formed in TEDA during the past 16 years were identified involving the utility, automobile, electronics, biotechnology, food and beverage, and resource recovery clusters. The article assesses the environmental benefits of the key symbiotic exchanges in TEDA and summarizes some unique characteristics of EIP progress in a developing country. Ó 2009 Elsevier Ltd. All rights reserved.
Keywords: TEDA Eco-industrial park Industrial symbiosis China Circular economy Industrial ecology
1. Introduction Industrial agglomeration has proven to be vital to the economic growth of developed countries [1], as well as to less-developed ones in East Asia, including China [2]. Industrial agglomeration concentrates economic development and resulting environmental pollution into a geographically confined area such as an industrial estate, presenting both opportunities and challenges for environmentally sustainable industrial development. On the one hand, environmental benefits arise from reduced transportation needs, improved economies of scale for pollution control and disposal facilities, and the potential for better environmental cooperation based on increasing inter-firm communication. On the other hand, the concentration of industrial activities can lead to severe pollution and resource depletion exceeding local ecological carrying capacity, particularly when necessary environmental management systems are not put in place as has sometimes been seen in China [3]. In 2007, 54 national economic and technological development areas (NETDAs) in China, occupying less than half a percent of urban land, absorbed 23 percent of foreign direct investment and accounted for 5 percent of China’s Gross Domestic Product (GDP), 4 percent of its tax revenues, and 15 percent of its international trade
* Corresponding author. Fax: þ203 432 5556. E-mail address: [email protected] (M. Chertow). 0959-6526/$ – see front matter Ó 2009 Elsevier Ltd. All rights reserved. doi:10.1016/j.jclepro.2009.10.002
[4]. In 2005, the energy efficiency of 54 NETDAs stood at 0.65 tons of coal equivalent (tce) per RMB 10,000 of industrial value-added as compared to the national average of 2.59 tce. The land and water productivity of 54 NETDAs was also much higher than the national average [5]. Chinese decision-makers and researchers were first exposed to the eco-industrial park (EIP) concept by the United Nations Environment Programme (UNEP) through its publication in Chinese in 1997 of Industry and Environment addressing the environmental management of industrial estates. Because an EIP strives simultaneously to increase industrial growth while reducing pollution and waste [6], the economic and environmental win-win potential of the EIP approach quickly drew the attention of Chinese environmental policy-makers [7]. During the 1990s, while resource-poor Chinese environmental authorities were waging an uphill battle against rampant noncompliance at the enterprise-level, they turned increasingly to flexible environmental policy tools, such as voluntary instruments, to pursue environmental protection at the industrial park and regional levels [8]. Against this backdrop, the State Environmental Protection Administration (SEPA),1 the national environmental
1 The State Environmental Protection Administration (SEPA) was raised to executive branch status as the Ministry of Environmental Protection, thus replacing SEPA, by action of the March 2008 National People’s Congress in Beijing.
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watchdog, launched an industrial park-wide ISO 14001 demonstration program in 1999 and an eco-industrial park demonstration program in 2000. Around this time, a number of countries embarked on deliberate attempts to develop eco-industrial parks (EIPs) to enhance business competitiveness while reducing resource consumption and mitigating environmental pollution through a systems approach to cycling of critical resources [9]. 2. Literature review A defining feature of EIPs is the formation of inter-firm industrial symbiosis (IS), described as ‘‘engaging traditionally separate industries in a collective approach to competitive advantage involving physical exchange of materials, energy, water, and byproducts. The keys to industrial symbiosis are collaboration and the synergistic possibilities offered by geographic proximity’’ [10]. In recent years a growing body of literature examining EIP/IS practice arose in North America [11–13], Europe [14–17] and Australia [18,19]. More recently, there are a few articles on Korean EIP development [20,21] and Singaporean experience in applying ecosystem concepts to the planning of a petrochemical complex [22]. The literature has gradually broadened from individual EIP case studies, to systematic assessment and comparison of national EIP programs, and to early attempts in industrial symbiosis theory construction [23,24]. The quantitative assessment of the economic and environmental impacts of industrial symbiotic activities has remained challenging and scant. Chertow and Lombardi [25] compare the economic and environmental savings resulting from the symbiotic activities against alternatives, such as previous practices or hypothetical alternatives for the firms involved. Social benefits have not typically been measured [26]. Cohen-Rosenthal [27] calls for incorporating job creation and quality of life concerns in industrial ecology research and Kurup et al. [28] have attempted to use triple bottom line indicators for including social benefits. Although the EIP concept has been actively promoted by international organizations and national governments in some developing countries such as China, Thailand, Philippines and India [29], there remains limited empirical literature on the overall experience. For example, Singhal and Kapur [30] examine the relevance of industrial symbiosis and carrying capacity concepts and propose an integrated approach towards IE planning in India. Since China launched the national EIP demonstration program in 2000, SEPA approved 24 industrial parks as the National Trial EIPs as of December 2007. Nevertheless, China’s practice in ecoindustrial parks remains very much unknown internationally. One notable exception is the Guitang Group, a sugar-refining industrial complex which, over the past four decades, has continuously expanded beyond sugar refining into pulp and paper, alcohol, and fertilizer production by utilizing the two key by-product streams from sugar cane production: molasses, the sugar refining residue; and bagasse, the fibrous waste product [31,32]. On the policy side, Geng et al. [33] examined China’s experience in setting up a new national standard for evaluating the performance of EIPs, the first of its kind globally. It calls for better incorporation of the principles of eco-industrial development and local realities in the future refinement of EIP indicators. This article contributes to the sustainable industrial development literature in several ways. First, it elucidates how the Tianjin Economic-Technological Development Area (TEDA), one of three national demonstration EIPs in China, evolved to form a complex industrial symbiosis network in a mixed industrial park. Second, it examines the features and patterns of existing and discontinued IS exchanges both quantitatively and qualitatively as well as examining the environmental impacts of such IS exchanges in relation to
regional resource use limits. Third, the article summarizes some unique characteristics of EIP growth in a developing country. 3. Materials and methods Tianjin Economic-Technological Development Area (TEDA) was founded in December 1984 as one of the first 14 national economic development zones in China. TEDA is located 45 kilometers east of Tianjin downtown and 130 kilometers southeast of Beijing city with a coastal area of 33 km2 facing the Bohai Bay (see Fig. 1). By all standards, TEDA is a large and multi-faceted industrial area, which, like so many other Chinese business developments, includes both industrial and commercial/residential areas. As of 2007, the total built up area of TEDA reached 45 square kilometers, of which the industrial zone accounted for 34 square kilometers and the residential area for approximately 11 square kilometers (TEDA 2008). With respect to materials and methods used in this study, the focus was exclusively on the 34-kilometer industrial zone. The research was based on a thorough literature review of government documents and other background materials concerning TEDA’s overall development, environmental management, and EIP planning and implementation processes. From May 2006 through June 2008, field trips and interviews of 42 companies located in TEDA were conducted to explore and verify existing industrial symbiotic relationships, and 18 recycling and waste management companies were investigated which handle and dispose of the wastes generated from TEDA companies. Further, 15 governmental officials and 6 researchers involved in the TEDA EIP planning and implementation process were interviewed. To approach the question of the relative interdependencies in TEDA, data were gathered to categorize the types of symbiotic exchanges, the average distances between the partners, and whether the location of the exchange partners was or was not within the boundaries of TEDA. As geographic proximity is a hallmark of symbiotic exchanges, we have paid special attention to ascertain the distances between respective symbiotic partners by using several Internet-based maps such as http://ditu.google.cn/. For those exchange partners that could not be located through the electronic maps, we directly consulted company managers about the approximate transportation distances. We adopted the administrative boundaries of TEDA as the system boundary of our research. 4. Evolution of TEDA When TEDA was first created on a salt pan in 1984, the only economic activity was salt-making and industrial output value was 2 million yuan [34]. Among the earliest foreign investment companies were Danhua Bicycle, Jingtai Porcelain and Wella Cosmetics. As of December 2007, TEDA had registered 4485 foreign investment enterprises with a total cumulative investment of US$ 40 billion since 1984. Among the Fortune 500, 62 multinational corporations established 137 enterprises in TEDA2. Meanwhile, 9527 domestic enterprises were registered at TEDA with aggregate registered capital exceeding RMB 60 billion yuan. Of the domestic companies, 7547 companies were privately owned with a total registered capital of RMB 26.33 billion yuan [35]. In 2008, the gross industrial output value for TEDA totaled 373 billion yuan [36]. TEDA has been ranked as the most attractive economic development zone for foreign investment by China’s Ministry of Commerce for 10 consecutive years from 1998 to 2007 [4].
2 Source: Official website of TEDA investment service (www.investteda.org/qygl/ ysjs/jjys).
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Fig. 1. Geographic location and zoning of TEDA.
Four ‘‘pillar industries’’ have evolved to be most significant in TEDA. These are electronics, automobile & machinery, biotechnology & pharmaceutical, and food & beverage industries contributing a gross industrial output value of RMB 308 billion. Breaking this down, electronics accounted for 49%, automobile & machinery for 32%, biotechnology & pharmaceuticals for 6%, and food & beverage sectors for 4%, of gross industrial output values in 2007. Electronics. There were very few companies producing electronic products in TEDA before 1992. Motorola’s investment in 1992
changed TEDA’s trajectory. Beginning in 1995, Samsung Group also started to produce monitors, digital cameras, DVDs, cell phones and other electronic products in TEDA. In 1997, the industrial output value of the electronics industry reached 20.34 billion yuan, accounting for 56.2 percent of the gross industrial output value of TEDA. Since then, the electronic industry has continued to grow and remained the largest industry at TEDA (see Fig. 2). Machinery and Automobiles. A German company called SEWEurodrive started to invest in the machinery sector in TEDA in 1995.
Fig. 2. Change in gross industrial output values of the four pillar industries in TEDA.
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Toyota Motors and Chinese leading auto-maker FAW decided to invest jointly in auto-making facilities in 2000, signifying a milestone for this industry of TEDA. The automobile industry cluster has grown rapidly since then. Biotechnology and Pharmaceuticals. A world leader in biotechnology, Denmark’s Novo Nordisk, started to invest in TEDA in 1994. Other major biotech and pharmaceutical companies include GSK and Servier. Currently, Novozymes (China) Biotechnology Co., Ltd., a spin-off company from Novo Nordisk located in TEDA, has become one of the three strategic production bases of Novozymes Group worldwide. Food and Beverage. A Taiwanese-back company called Tianjin Tingyi International Food Co., Ltd. started to produce instant noodles in 1992. Between 1992 and 1996, Tingyi continued to establish ten more companies to produce and package beverages and confections as well as to supply packaging materials, starch products, oil and fat products, and food production machinery. Tingyi rapidly grew to be the market leader in instant noodles, ready-to-drink teas, and sandwich crackers in China [37]. Apart from Tingyi, Coca-Cola, Nestle, Kraft, and Pepsi have also established their production facilities at TEDA.
Table 1 Timeline of environmental institution development at TEDA. Year
Main developments
1984 1990
TEDA created. TEDA established its own Environmental Protection Bureau (EPB). TEDA Environmental Protection Association was established among companies. Motorola obtained the first ISO 14001 certification at TEDA. TEDA was ISO 14001 certified. SEPA nominated TEDA as a national demonstration zone for ISO 14001. TEDA started to make public its annual environmental report for 2000. The strategic goal of pursuing an EIP was put forward by TEDA. TEDA signed the International Declaration on Cleaner Production. TEDA started to formulate an EIP development plan. A leading group for developing TEDA into a national pilot EIP was formed. The TEDA EIP development plan was approved. SEPA nominated TEDA as a National Trial EIP. TEDA Waste Minimization Club was established. A logo management system of industrial solid waste was launched in TEDA. NDRC nominated TEDA as a national pilot industrial zone for demonstrating circular economy. The TEDA Committee for Promoting the Circular Economy was established. The TEDA Circular Economy Promotion Center was established. The Provisional Management Methods of CE were promulgated. The Ministries of Environmental Protection, Commerce, and Science and Technology nominated TEDA as one of the first three National Demonstration EIPs.
1996 1998 2000 2000 2001 2001 2002 2002 2003 2003 2004 2004 2005 2005
5. Evolution of an environmental institution in TEDA
2005
Following its establishment in 1984, TEDA was the first national economic-technological development area to create an independent environmental regulatory body, when, in 1990, management created the TEDA Environmental Protection Bureau (EPB). From 1990 on, TEDA EPB has continued to upgrade its environmental management capacity and install new environmental programs such as environmental impact assessment of new investment projects, environmental monitoring of existing key water and air pollution sources, pollution discharge levies, total pollutant emission control, and other initiatives. Table 1 provides a chronological development of environmental management initiatives at TEDA. In 1999, the State Environmental Protection Administration (SEPA) circulated a policy opinion to encourage the national industrial, high-tech, and tourism development zones to establish park-wide ISO 14001-conforming environmental management systems and join the National ISO 14001 Demonstration Zone Program. At the national level, Suzhou New District became the first industrial estate awarded an ISO 14001 certification in September 1999 [38]. In strategic terms, TEDA continuously faced fierce competition for foreign investment from other frontrunner national industrial development zones in Suzhou, Dalian, and Guangzhou. Consequently, TEDA management decided to pursue any measures that would contribute to consolidating its leadership status among national economic development areas. Thus, the TEDA Administrative Commission, the government authority in charge of the daily operation of TEDA, decided that obtaining an ISO 14001 certification for the entire industrial estate not only would elevate the environmental management capacity to a whole new level, but also would enhance the investment climate and public image internationally [39]. TEDA was granted both ISO 14001 certification in November 2000, and designation by SEPA as one of the National ISO 14001 Demonstration Zones in the same year. Table 2 identifies many other environmental management activities that followed, responding in part to directives and in part to competitive pressures. In 2005 TEDA was chosen as a national pilot industrial zone for demonstrating the circular economy development model by the National Development and Reform Commission. In 2008 TEDA was nominated to be one of the first three National Demonstration Ecoindustrial Parks jointly by the Ministries of Environmental Protection, Commerce, and Science and Technology.
2006 2007 2008
Source: Compiled from various sources.
6. TEDA, industrial symbiosis, and public infrastructure Given that the land for TEDA was saline, topsoil and soil conditioning materials have always been in great demand to be able to prepare it for industrial and residential development. Actually, land development in TEDA led to severe farmland degradation in nearby rural areas as a great amount of topsoil was moved to the industrial area. Water resources are transmitted from a reservoir 52 kilometers away and are in acute shortage. At present, TEDA only extracts some groundwater to supply as hot Table 2 Timeline of development of key environmental infrastructure at TEDA. Year
Main activities
1987 1987 1995 1998 2000 2001
First co-generation power station was put into operation. TEDA Landscaping Development Co. established. TEDA Water Treatment Plant (Phase 1) became operational. TEDA Water Treatment Plant (Phase 2) established. TEDA Wastewater Treatment Plant was put into operation. An electroplating wastewater treatment facility started operation. A flue gas desulphurization system was installed in one thermal power station. The Hangu Domestic Garbage Landfill started operation. The TEDA Water Reclamation Plant (Phase 1) was put into use. Tianjin Hazardous Waste Treatment & Disposal Center commenced operation. A new fluidized bed combustion co-generation power station was put into operation. Tianjin Shuanggang Waste-to-Energy Plant was placed in trial operation. The Binhai Rapid Mass Transit System was put into trial operation. The first sea water desalination plant was put into trial operation. Taiding Environmental Technology started to operate as a regional E-waste recycling hub.
2002 2002 2003 2003 2003 2004 2004 2007 2007
Compiled from various sources.
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water for industrial and commercial use. The excessive scarcity of both water and usable land has driven TEDA to conserve and make very efficient use of these critical natural resources since the early 1990s. Subsequently, numerous industrial symbiosis activities involving energy, materials, and water were developed involving the public infrastructure system with key milestones over 20 years reviewed in Table 2 and some highlights discussed below. Public Utilities – Water/Steam/Energy. Sharing of public utilities and environmental infrastructure is an important hallmark of Chinese EIPs as it is essential to provide high quality and low cost utility and infrastructure services to companies to woo their investments in the first place (see Fig. 3). Along these lines, the Tianjin TEDA Water Technologies Co., Ltd. started to build the first water reclamation plant in 2000. The facility uses the effluent of the TEDA Sewage Treatment Plant as input and adopts continuous micro-filtration (CMF) pretreatment and then a reverse osmosis (RO) process for deionization. In 2006, 1.43 million tons of ROtreated reclaimed water was supplied for industrial processes and 2.35 million tons of CMF-processed water was used for recharging an artificial wetland and for landscaping. Major industrial users of reclaimed water are Tianjin Binhai Energy and Development Co., Tianjin FAW-Toyota Motors Co., SEW- Eurodrive, and TEDA Ecolandscaping Development Co. In Chinese industrial parks, co-generation that is primarily aimed to supply steam is the norm rather than the exception. Four out of the five thermal power plants in TEDA are coal-fired, supplying steam and hot water for users in TEDA. To supplement a shortage in the process steam supply for TEDA, Tianjin Soda Plant began supplying steam to TEDA in 2001. In addition, Tianjin Binhai Energy and Development Co. started to recycle condensate from large steam users such as an automobile manufacturer. TEDA also established a pilot desalination facility with a treatment capacity of 10,000 cubic meters per day for phase 1 by using the low-pressure steam from the neighboring thermal power station. In addition, the TEDA Thermal Power Plant consumed 182,777 tons of double RO water as boiler supply water in 2006 [40].
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Public utilities - water cascading, landscaping, soil creation: In 1997, the TEDA Eco-landscaping Development Co. Ltd. developed an innovative technology to produce new soil out of three solid wastes: Bohai Sea sediments, caustic soda sludge, and fly ash from the TEDA Thermal Power Plants. The initiative considerably reduced the destruction of topsoil from neighboring farmland and conserved a significant amount of farmland in the 1990s. New soil sources, however, are no longer cost competitive because of the increasing prices paid since the late 1990s for the coal fly ash and sea sediments for even higher value uses. Public utilities - solid waste: TEDA’s Shuanggang Municipal Waste Energy-Recovery Incinerator began operation in 2004, converting about 400,000 tons per year of municipal solid waste into 120 GWh. It also makes floor tiles out of its bottom ash as well as haydite – a light weight aggregate - from its fly ash which is characterized as a hazardous waste. Tianjin Hejia Veolia Environmental Services Co., Ltd. invests in and operates the Tianjin Hazardous Waste Treatment and Disposal Center (THWTDC), which commenced operation in 2003. Apart from physicochemical treatment, secure landfill and incineration of hazardous waste, THWTDC also began to clean/recycle solvent drums in 2006 and began solvent recovery in 2007. Industrial exchanges: In addition to the public infrastructure, since the mid-1990s, a series of industrial symbiosis activities involving energy and water cascading and solid waste exchanges gradually emerged among the four pillar industries (electronics, machinery and automobile, biomedicine, and food & beverage sectors). These are summarized below. Electronics cluster: In addition to traditional waste minimization and recycling practices, several companies started to recycle spent lead solder materials including Motorola (China), Tianjin Samsung Electronics Co., Ltd., General Semiconductor (China) Co., Ltd., and Tianjin Fujitsu Ten Electronics Co., Ltd. Reuse and recycling of CRT glass, waste oil, and silver extracted from electroplating residues are other examples of materials encompassed in interfirm exchanges.
Fig. 3. Symbiotic exchanges associated with the public utility sector.
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Food and beverage cluster: In 1992 Tianjin Tingyi International Food Co., Ltd. started to sell its flour scraps from instant noodle production to nearby pig farms as pig feed. This represented the first symbiotic relationship formed at TEDA. Later on, Tianjin Nestle Co., Ltd., Kraft Tianmei Food Co., Ltd., and Tianjin Tingyuan Food Co., Ltd. also sold their food scraps as animal feed to neighboring farms. In addition, Tianjin Tingfung Starch Development Co. Ltd. supplies its starch scrap to a local coal briquette factory to produce coal briquette. Chia Tai (Tianjin) Industrial Co., Ltd. sells soybean residues to Tianjin Chia Tai Feeds Technological Co., Ltd, fatty acid and lecithin to food producers. Biotechnology & pharmaceutical cluster: In 1998 Novozymes (China) Biotechnology Co. Ltd. began production of a wide range of liquid and granulated enzymes in TEDA, one of three globally strategic production sites for the Danish company. The TEDA facility’s bulk production waste – the spent biomass containing high levels of nitrogen, phosphorous, potassium, and other organic matter – has been converted into a solid organic fertilizer called NovoGroÒ30 with a dry matter content of 30%. Novozymes (China) supplies about 20,000 tons of NovoGroÒ30 annually for TEDA land reclamation and farmland fertilization free of charge. Since 2000, Novozymes has supplied its treated industrial effluent for irrigating greenery by the TEDA Eco-landscaping Development Company and since 2002, for road cleaning/maintenance by the TEDA Public Works Company. Automobile & machinery cluster: The burgeoning automotive and machinery cluster primarily consists of the closed loop recycling of scrap galvanized sheets and aluminum in the Toyota auto making facilities as well as the closed-loop lead recycling between Tianjin Tong Yee Industrial Co., Ltd. and Tianjin TOHO Lead Recycling Co., Ltd. (see Fig. 4). Tianjin Toyotsu Resource Management Co., Ltd. has annual scrap recycling capacity greater than 60,000 tons. In late 2006, Tianjin Toyotsu Aluminum Smelting Technology Co., Ltd started to produce molten aluminum for the neighboring Tianjin FAW Toyota Engine Co., Ltd. from locally produced aluminum scrap supplemented by imported aluminum scrap. Tianjin TOHO Lead Recycling Co., Ltd, established in 2005, is the first environmentally sound recycler3 of used lead-acid batteries and other lead waste in the Tianjin and Beijing region. Tianjin TOHO recycles the scrap lead generated from lead-acid battery manufacturing at Tianjin Tong Yee Industrial Co., Ltd., lead waste from other enterprises such as Motorola (China), and used lead-acid batteries from the Tianjin and Beijing regions (see Fig. 4). Several other sectors are involved with symbiotic exchanges including furniture scrap for fuel and plywood, printing and packing waste and paper scraps sent to a paper mill, and gypsum scraps from pottery sold to a nearby cement mill.
7. Results Following two years of field research, 81 symbiotic exchanges were identified, overall, as having been formed in TEDA. Of these, 70 are currently functioning and 11 have been discontinued as discussed below. This finding indicates that a complex adaptive industrial symbiosis network has taken shape in TEDA since it was first established from scratch in 1984. To provide a sense of the total quantity of resources exchanged, the following figures show significant although still incomplete results achieved in 2006:
3 The lead recycling facility is among a few national certified environmentally sound lead recycling facilities.
1.26 million cubic meters of reclaimed water purchased by industrial users; 1.35 million cubic meters of tertiary treatment effluent used for recharging the local water bodies; 182,777 cubic meters of double Reverse Osmosis reclaimed water used for substituting the boiler supply water of a CHP power plant; Over 400,000 tons of municipal solid waste and 25,000 tons of straw incinerated to produce 120 GWh of electricity; 5115 tons of lead waste recycled into 3094 tons of lead alloy; 98591 tons of fly ash and bottom ash used in construction projects and landscaping; 23,193 tons of NovoGro used as fertilizer in nearby greenery, orchards and farms; More than 12,000 tons of scrap galvanized plates recycled as raw materials and auto moulds for auto making at TEDA; More than 2000 tons of wood scraps used for plywood production and 8700 tons of wood scraps used as fuel to substitute natural gas; 2200 tons of new paper scrap and over 4100 tons of new cardboard scrap recycled; 16 tons of spent lead-containing electronic solder recycled for solder materials; More than 3700 tons of food wastes made into animal feed; 900 tons of rubber scraps made into other rubber products; 800 tons of plastic scraps recycled into plastic pellets; 1400 tons of sludge and almost 1100 tons of gypsum scrap employed as cement raw materials; 800 tons of used resin reused in road construction. Within the total of 81 exchanges, energy exchanges account for 9%, water exchanges account for 15%, and material-based exchanges account for 76 percent. The average distance between energy-related symbiotic exchanges is 2.9 km, shorter than the average distance of water-related symbiotic exchanges (3.5 km), and in turn much shorter than the one for material-related symbiotic exchanges (28.2 km). This is strong evidence that energy and water related symbiotic exchanges are more sensitive to geographic distance than material-based symbioses. We further break down the existing 81 symbiotic exchanges into two categories: internal-internal (I-I) and internal-external (I-E) type (see Table 3). The 33 I-I type symbioses represent the symbiotic exchanges formed between two companies located within the boundaries of TEDA. The 48 I-E symbioses represent symbiotic exchanges formed between one company located within TEDA and one outside TEDA’s boundaries. Water-related IS exchanges only exist within the boundary of TEDA. For I-E symbiotic exchanges, 46 of 48 are material-based while 2 are energy based. It is worth noting that over 59 percent of IS exchanges are formed beyond the boundary of TEDA. As geographic proximity is a hallmark of industrial symbiosis, we particularly examine the average distances of energy, water and material-based exchanges of both I-I and I-E type symbiosis (see Tables 4 and 5). It is clearly shown that the average distance, 11.5 km, of the I-I type material-based symbioses is much shorter than the 34 km average distance of the I-E type material-based symbioses. A systemic assessment of the emergence of IS exchanges in TEDA is illustrated in Fig. 5. The development of 7 energy-based synergies is quite evenly spread over the period, while the 12 water-based exchanges are concentrated more during the development of park-wide water reclamation and sea water desalinization systems since 1999. As noted above, 11 IS exchanges of the 81 identified were discontinued during the period examined. Some scholars express their
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concern with the negative implication of the so-called ‘‘lock-in’’ effect of industrial symbiosis [41,42] for the sustainability of industrial ecosystems. To shed some new light on this issue, each IS exchange that first became established, but later fell apart is examined. The primary reasons for discontinuance are based on changing circumstances which are a characteristic of any business or market activity as follows: 1. Cleaner production: in 6 of 11 cases, cleaner production, which substantially reduces waste generation in the first instance, created the modification that led to the discontinuance of symbiotic exchanges. In the case of a major food producer, for three years the company supplied its treated effluent to a local landscaping firm for landscaping purposes. When the food producer increased in-plant water reuse, there was not enough water for external reuse and this exchange terminated. A large electronics manufacturer redesigned its packaging to gain substantial reduction of paperboard rather than recycling. Another phased out the use of trichloroethylene solvent (TCE) rather than continue to recover it. 2. Prices: in two cases, exchanges were made unfeasible because of increasing prices. In one case this caused a by-product to increase in value and was no longer available for within-park use. In another instance, the high price of steam made the operation of the pilot desalination plant economically uncompetitive and its operation was discontinued. 3. Environmental liability concerns: in two cases concern over liability drove waste generators toward more conventional waste disposal. 4. Bankruptcy: the suspension of production of a food processing plant led to the breakdown of IS exchanges associated with the firm.
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Table 3 Summary of all symbiotic exchanges identified in TEDA as of 2008. Resource exchanged
I-I symbiosis
I-E symbiosis
Subtotal (%)
Average distance (km)
Energy Water Material Subtotal
5 12 16 33
2 0 46 48
7 (8.7%) 12 (14.8%) 62 (76.5%) 81 (100%)
2.9 3.5 28.2
Note: I-I ¼ Internal vs. internal, I-E ¼ Internal vs. external.
8. Discussion and conclusion This paper provides a detailed examination of the development of TEDA, a mixed-industry industrial park with the subsidiaries of more than 60 non-Chinese Fortune 500 companies, into an EIP in China. TEDA has shown several special features on the path to becoming an EIP. First, TEDA itself was established as a result of experimentation within China’s reform policy, thus institutional innovation has been built into the DNA of TEDA with TEDA management eager to learn and implement international best practices. Second, TEDA is pro-business and responsive to business requirements. A number of multinational corporations have introduced to TEDA sustainable production practices that were implemented in other countries. Third, TEDA is very sensitive to competition and has tried its best to maintain its leading position in China as an industrial park in the face of the heated struggle for foreign direct investment triggered by the Asian financial crisis in 1998 and subsequently China’s accession to the World Trade Organization in 2001. The development model for TEDA and most Chinese industrial parks is to provide low-priced, high quality infrastructure services
Fig. 4. Symbiotic exchanges associated with the automobile industry.
H. Shi et al. / Journal of Cleaner Production 18 (2010) 191–199
Table 4 Distances of type I-I symbioses of TEDA. Stdev
0.1 0.1 0.1
5 8 35
2.7 3.5 11.5
2.4 3.1 11.8
Note: all units are in kilometers.
to tenants subsidized by general local tax revenues in much the same way that a local government does. This model makes it possible for TEDA to implement some infrastructure-related investment initiatives which may not be financially feasible especially in the early stages, but result in an environmental benefit. The water reclamation system in TEDA, for instance, is heavily subsidized. Without the cross-subsidization to various infrastructure services by the TEDA Administrative Commission, it is unlikely that TEDA could have implemented a number of environmentally benign infrastructure projects such as a centralized electroplating wastewater treatment facility and a sea water desalination facility. Still, the TEDA Administrative Commission has been much leaner and more streamlined than most Chinese local governments allowing for more effective coordination and cooperation among different administrative divisions. With respect to innovation, TEDA has succeeded in developing critical technologies supportive of symbiotic exchanges such as a regional water reclamation system and new soil sources from soda slag and coal-fired bottom ash with the support of the national government. To enhance technological innovation for eco-industrial park development, the TEDA Administrative Commission has stepped up its financial support for R&D activities on critical technologies. Examples include condensate reuse, composting of traditional Chinese medicine slag, and environmentally sound disposal of fly and bottom ash from the municipal waste incineration plant. Weak technological innovation capacity within many companies located in TEDA, however, has proven to be a great hurdle for technological advancement, especially because waste reuse and recycling is not a core business activity for these firms. To overcome the bottleneck, it is vital to strengthen the partnership with external innovation centers. Another useful approach is to sensitize decision-makers in the TEDA Administrative Commission and many companies about the need for environmental innovation as the focus has mostly been on core product/process innovation. Cleaner production or pollution prevention at the firm level plays a more prominent role in the development of EIPs in China compared with the EIP initiatives in industrialized countries. Even for those subsidiaries of multinationals operating at TEDA, there is still considerable room for implementing cleaner production [43]. This need has been emphasized by both Chinese scholars [44] and international researchers [45,9]. There are occasional conflicts, however, between cleaner production and inter-firm exchange. Successful efforts in cleaner production may substantially reduce and even eliminate the waste to be exchanged in the first place. A representative example is that Tianjin Tong Yee Industry Co.’s lead production waste had been greatly reduced as a result of effective pollution prevention measures in the workshops in response to skyrocketing lead prices from 2006–2007. As
Table 5 Distances of type I-E symbioses of TEDA.
Energy Material
Min
Max
Mean
Stdev
0.6 0.8
6 232
3.3 34.0
3.9 34.5
Note: all units are in kilometers.
Energy
Material
12 10 8 6 4 2 0 88 19 89 19 90 19 91 19 92 19 93 19 94 19 95 19 96 19 97 19 98 19 99 20 00 20 10 20 20 20 03 20 04 20 05 20 06 20 07
Mean
87
Max
Number of new IS exchanges
Water
Min
19
Energy Water Material
14
19
198
Fig. 5. Evolution of symbiotic exchanges in TEDA.
a result, the change imposed significant pressure on a local lead recycling facility to secure adequate raw materials from others for its operation. The earliest symbiotic relationships were formed spontaneously across industrial companies. They were initiated primarily for economic cost-saving reasons while their environmental benefits tended to be little recognized. More than 50 percent of the IS relationships are formed between companies in TEDA and firms outside TEDA; thus, the boundaries of industrial parks have not confined the development of industrial symbiosis among companies. There is a clear trend for the key electronics and automotive companies to outsource the lowest value-added and often pollution-intensive production of intermediate components and materials such as electroplating to outside industrial parks. In the long run, the environmental performance of EIPs should take into consideration the spillover effects beyond the boundary of an industrial park. Coordination across key stakeholders and information dissemination have proven to be crucial to the development of industrial symbiosis, the backbone of an eco-industrial park. In the case of TEDA, the TEDA Environmental Protection Bureau has played a leading role and external technical expertise has been actively sought to assist the development processes. The TEDA Administrative Commission has also played a strong role through public policies, in particular in the form of subsidies, which have promoted industrial symbiosis, cleaner production, and proper waste disposal at the plant level. It has been shown that economic feasibility remains one of the decisive factors for the sustainability of industrial symbiosis relationships. A number of prior symbiotic exchanges were discontinued because of inadequate economic feasibility triggered by a change in byproduct prices. Public policies, therefore, could be geared toward adjusting the basic economics of the IS activities to recognize and reward their positive environmental externalities rather than to establish IS exchanges themselves.
Acknowledgements We acknowledge that the research was impossible without the full cooperation and support from WEI Hongmei, YAN Xu, DING Ting, and WANG Huizhen of the TEDA Environmental Protection Bureau. We also acknowledge the financial support from the McMillan Center for International and Area Studies and the Yale Program on Industrial Ecology in Development Countries. We take full responsibility for any remaining errors.
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