ASHRAE Journal - June 2012 - 6

industry news

(Left) More than 48,000 visitors attended the China Refrigeration Exposition in Beijing. The show rotates annually between here and Shanghai. (Right) Some 1,100 exhibitors displayed products at this year’s China Refrigeration Expo.

AC Not Just Luxury in China
Balanced Growth Means Big Numbers
BEIJING—The numbers associated with China’s air-conditioning market are staggering. An estimated 21 billion ft2 (1.9 billion m2) of new buildings are being constructed annually. China’s household air-conditioning production accounts for 75% of the global capacity. China is the world’s second-largest consumption market if not the largest, for air conditioning. Even though sales volume has leveled off in Beijing, Shanghai and Guangzhou, and in spite of increasing costs due to labor and raw materials, double-digit growth is expected to continue through demand from China’s so-called third and fourth-tier domestic markets. Air conditioning has moved from a luxury product to a middle class necessity in much of the country. Add refrigeration demand, and China’s potential is off the charts. China loses 25% of its food to gaps in its cold chain (some 40% of fruits and vegetables). It is estimated that improvements to the refrigeration infrastructure can increase China’s food supply by 15%. Numbers like these fueled optimism among exhibitors at China Refrigeration Expo, where all the major international players stood alongside Chinese companies to display new technologies that
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tap into China’s domestic market and its production capacity. The 2012 show held in Beijing from April 11 to 13 was the largest edition ever, with 1,100 exhibitors covering 92 700 m2 (997,800 ft2). Initiatives by the Chinese government bode well for the industry. The country’s 12th Five Year Plan (FYP) emphasizes “balanced growth.” Unlike FYPs in the past

Gree is the world’s largest residential air conditioner firm. Gree, like other Chinese companies, promotes the concept of “Created in China” rather than “Made in China.” that focused on economic growth figures, the 12th FYP emphasizes green energy and sustainable developments. Because some 80% of China’s energy output comes from coal, bringing with it environmental damage, China must start controlling its growth rate, the government says. “If China develops like the U.S.,” one government official said, “we will need
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another planet to sustain ourselves. The only solution is to contain energy growth by focusing on energy improvements and alternative technologies.” Since this is China, that means stateguided capitalism. As examples, Beijing announced it plans to establish 35 million m2 (377 million ft2) of green buildings in the next four years, and Tianjin announced it will finish 12 million m2 (129 million ft2) of residential buildings and 4 million m2 (43 million ft2) of public building energy retrofitting in 2012. The FYP mandates an increase in the proportion of non-fossil fuels in energy consumption to 11.4% by 2015; reduction of energy consumption per unit of gross domestic product (GDP) by 16% from 2010 levels by 2015; and a reduction in carbon dioxide emissions per unit of GDP by 17% from 2010 levels by 2015. With its “green, low-carbon development concept,” it is the first Five Year Plan to include a commitment to gradually introduce market mechanisms to control carbon pollution. One company banking on the opportunities presented by China is Danfoss. According to Mogens Terp Paulsen, president of Danfoss Refrigeration and Air Conditioning Control, China is to add 10 million tons (35 million kW) of refrigerated storage capacity by 2015, increase the number of refrigerated vehicles by 40,000,
June 2012

ASHRAE Journal - June 2012

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