By Gracie Sun
The U.S.-China Green Fund, initially announced during President Xi Jinping’s 2015 state visit to the United States, celebrated the first-year anniversary of its establishment on November 2, 2017. It was a great honor for the Paulson Institute to be part of the celebration.
The Fund grew out of an initiative by the Paulson Institute and China’s Office of the Central Leading Group for Financial and Economic Affairs to provide support for China’s efforts to reduce green house gas emissions as part of its war against pollution. The for-profit private equity fund is a unique public private partnership between the United States and China, for-profit and not-for-profit institutions, and leading private sector companies.
The focus of the Fund is to source and deploy U.S. technologies to provide solutions on energy efficiency with an initial emphasis on greening buildings – new and existing – and with plans to expand rapidly across different sectors. There is a professional team of financial experts overseeing the investments and supporting the Fund’s research efforts with the creation of the US-China Green Energy Technology Research Institute in Shanghai.
In the past year, the Fund has focused on the investment in the following three key verticals:
- Green Energy, Energy Efficiency, and Environmental Protection
- Green Smart Cities
- Green Smart Villages
There are commitments of over RMB 3 billion for investments. To date, the Fund has already completed strategic investments in several projects including:
- Took a controlling stake in East Low Carbon, a leading ESCO company focused on commercial building energy efficiency
- Co-launched a distributed solar fund with Trina Solar, the world’s largest solar panel maker
- Established a restricting fund for the steel industry, together with BaoWu Steel, China Merchants Group and the Wilbur Ross Company
- Invested in Hosjoy, a company that provides comprehensive smart and energy efficiency solutions for residential apartments
As a result, the Fund has helped complete RMB 100 million in purchases for U.S. companies including GE, Johnson Control, UTC, Honeywell, and Dow Chemical, with another RMB 100 million contracts under negotiation.
This Fund has the potential of being a model for others within China as it makes environmental protection a top priority, as well as for other countries especially as China seeks to green the Belt & Road. The Paulson Institute remains proud to be a non-commercial advisor to the Fund and is delighted to have been a part of the Fund’s one-year celebration.