Sustainable Development Equity Investment Forum | SUA

Sustainable Development Equity Investment Forum·Carbon Neutralization

As the largest developing country in the world, China has already pledged to reach a carbon peak in 2030 and to achieve carbon neutralization by 2060 at the UN General Assembly in 2020. September 2021 celebrates the first anniversary of China's "3060 ambition," and the society is now experiencing a transformative change over the past year as it brought various industries new challenges and endless opportunities. In the era of carbon neutralization, what will investors and entrepreneurs do to tackle the challenges, seize the opportunities, and fight for a green future?

On September 29th, 2021, under the guidance of Shenzhen Ecological Environment Bureau, the final round of "Sustainable Development Equity Investment Forum·Carbon Neutrality" and "SDGs Entrepreneurship Competition·Zero Carbon Community" was successfully held in Shenzhen Stock Exchange. The event was jointly sponsored by China Alliance of Social Value Investment (CASVI), Shenzhen Institute of Sustainable Development, and Shenzhen Securities Information Co., Ltd.

Zhong Wen, Deputy Director of Ecology Environment Bureau of Shenzhen Municipality, Weihua Ma, Chairman of China Alliance of Social Value Investment, Ke Liu (Live), School of Innovation and Entrepreneurship at SUSTech, Sean Kidney (Live), Co-founder and CEO of Climate Bonds Initiative, Baoyao Zhang (Live), COO of Asian Venture Philanthropy Network (AVPN), and representatives from all sectors of investment gathered to explore opportunities and paths to carbon neutralization.

Weihua Ma said that the world is facing severe challenges of sustainable development, and China is shouldering an important mission. Sustainable development has become one of the strategic priorities of many global leading companies. During such a critical time, enterprises and impact investments become essential. As the most consistent investment concept with "sustainable development," impact investment is undoubtedly an important force to support start-ups undertaking a sustainable path.

The calculation of China's carbon emission data is complex. Besides, carbon emission reduction is still arduous, though highly vital. Therefore, Ke Liu believes that there are two crucial paths for China to achieve carbon neutrality. The first is to promote the use of clean energy and reduce carbon emissions. The second is to increase CO2 absorption, that is, to increase green land and carbon sink.

Different types of clean energy have their limitations. For instance, the cost of nuclear power has increased significantly after the Fukushima Nuclear Disaster; hydropower is also controversial, and some built hydropower stations have also been abandoned; tidal and geothermal power generation is highly regional selective. Not only that, these energy types only account for a small proportion of the energy supply. As a result, wind energy and solar energy have taken up an important supply task among nonfossil energy sources. Nonetheless, challenges remain. Mr. Liu said that the biggest issue of wind energy and solarenergy is intermittent electricity, which means they are not continuously available nor stable.Thus, the high cost of energy storage and the lack of revolutionary breakthroughs are the crucial challenges of carbon neutralization. Therefore, transforming China's coal economy into a green methanol economy is one of the important directions of carbon neutralization.

To achieve carbon neutrality, capital plays a vital role. At the forum, Sean Kidney shared a set of data with the audience. The world needs at least 90 to 100 billion USD (about 700 billion yuan) to create a clean, green, and stable economic environment in the next 30 years.The global green bond market has reached 2 billion USD (about 13 billion yuan) and is growing at an 80% rate. There are substantial financing opportunities, but it still needs theattention of venture capital and private equity investment institutions.

Mr. Kidney also mentioned that in addition to capital and institutional players, carbon neutralization also needs innovation. Particularly those new ideas from innovative enterprisesand successful entrepreneurs in the green field. In China, many green financing projects are suitable for small enterprises. Therefore, Mr. Kidney predicted that there would be explosive growth for investors and entrepreneurs for a long time if we transformed the system and allowed innovative ideas.

China's 3060 ambition" is exciting for the world, especially for China's neighboring countries. Baoyao Zhang mentioned that the world has been severely affected by extreme weather in the past year; therefore, dealing with climate change is becoming more and more urgent. But since new opportunities are also emerging and developing rapidly, it is quite timely and meaningful for CASVI to hold the "SDGs Entrepreneurship Competition." He believed that responsible organizations need to encourage entrepreneurs to carry out sustainable practicemore than ever before. In the end, Mr. Zhang also expressed his hope for AVPN and CASVIto jointly promote the construction of a harmonious and green Asia and to guide foreign investors to better understand and participate in China's low-carbon market.

The first roundtable discussion is chaired by Xing'an Ge, Chief Consulting Officer of Susallwave, and the senior researcher at Beijing Green Finance Association. Silong Li, Managing Director of Country Garden Venture Capital, Donglei Yan, Managing Director at North Summit Capital, Hui Zhang, Director of China Renaissance Capital Investment, and LinZuo, Managing Partner of Tsing Capital, held a dialogue on the theme of "Investment Opportunities under Carbon Neutrality." All institutions shared their achievements in the fields of sustainable development and low carbon development. They also shared their prospects for the venture capital community under the "3060 ambition."

Silong Li shared that Country Garden Venture Capital always adheres to sustainable development values. He looks forward to mobilizing the high-quality community resources of the Country community resources of the Country Garden Group with more technology start-ups. Donglei Yan believed that carbon neutrality is the most deterministic track at present, and it contains abundant investment opportunities. Mr. Yan also shared an investment logic that pays attention to the relationship between supply and demand. Hui Zhang pointed out that technology innovation not only needs the support of the policy system and education system, but also the guiding force of capital. The carbon neutralization goal gives more robust guidance to capital and provides stronger impetus to both industry and investment.Lin Zuo pointed out that the "3060 Ambition" is the most reliable way to evaluate economic transformation quantitatively. He also believed that the energy field would usher in greater innovation

The second roundtable discussion is chaired by Dong Wang, Director of Shenzhen Research Center on Climate Change. Weiwei Liu, Director of AI Investment at the Jindi Group. Juan Xu, Chairman of Sichuan Eco-Environmental Protection Industry Group, Qing Ye, Chairman of Shenzhen Academy of Building Sciences, and Siming Zhu, Partner of Nomura Research Institute, participated in the discussion. The panelists started the theme "Development Trend of Zero Carbon Community" by offering suggestions to zero-carbon communities. Qing Ye explained the concept, difficulties, and future development trend of "zero-carbon building." Weiwei Liu shared the Jindi Group's explorative path to building a zero-carbon community. Siming Zhu shared his views on the "zero-carbon community" from an energy sector's perspective. Juan Xu shared the industrial foundation of the zero-carbon community. She also expressed the expectation to cooperate with the start-up projects from the "SDGs entrepreneurship Competition."