褚大建循环经济与新型工业化Circular Economy and China's New Industrialization

Circular economy and China’s New Industrialization1
Dr Zhu Dajian, Director, Sustainable Development and Management Institute, Tongji University
Abstract The main purpose of this article is to introduce the realization of circular economy in the industrial production system. In summarizing the drawbacks of China’s traditional industrialization and forecasting constraints on resources in the future development of industrialization, it points out that development of circular economy is the new path of industrialization in China. Circular economy in the industrial system falls into three categories, namely developing ecology in enterprises, building eco-industrial parks and developing “venous industry” in every stratum of society. This article explains the general situation and the development trend in each category. It introduces some successful cases in China, which serve as examples for the development of new industrialization. Keywords Circular Economy, New Industrialization, Eco-Industrial Parks, Venous Industry
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Development of China’s Industrialization in Need of Circular Economy
1.1 Traditional Industrialization in China – History and Analysis of Problems Industrialization in China started in the 40s of the 18th century, which was more than one hundred years before the founding of the People’s Republic of China. Since then development had been very slow until 1949, with GDP in industries of only 12.6% and employment in industries of only 2%. China was still a backward agricultural country. Since the 1940s, industries of large-scale machinery production and modern national industries had emerged, and a few movements for industrialization had also been run. However, due to many times of warfare which brought about social instabilities, no substantial achievements had been made. From the time of the “First Five-Year Plan” (1953-57) to the time just before the Open Door Policy – only a 20 to 30-year period – the initial target of the country’s industrialization was basically reached, building up an infant stage of national economy and industrial system with comprehensive segments.
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This article is an excerpt of Chapter 7, Circular Economy and Sustainable Development in China, edited by Zhu Dajian, published by Science Publication Co., Beijing, 2007; authorization has been obtained from Dr Zhu for extraction. 1

However, China has paid a lot during the process of traditional industrialization. Problems such as a highly centralized planned economy, unclear property rights and low degree of openness to the world have been noted. This mode of traditional economy is also based on large consumption of mineral and energy resources, leading to ecological disruptions and environmental pollution. Due to blind devotion in the pursuit of fast economic development, many heavily polluting industries and enterprises of high consumption of resources aggravated the severe environmental problems, such as poor quality of air, water pollution as well as excessive mining of mineral resources and energy. Moreover, excessive cutting of timber in forests has caused soil erosion and river breakage. As a lot of people remain in agricultural population and stay in villages and the state investment in agriculture has receded, land use is in much greater demand, causing serious desertification. Furthermore, the problems emerging during China’s development such as lack of co-ordination in urban and rural development, unbalanced development of different regions, discord in economic development of society as well as irrational structures of production. One of the main causes of these problems is also the inappropriate direction of industrialization. 1.2 Future Development of Industrialization – Constraints in Resources and Problems in the Environment According to the Bulletin of the Statistics of National Economy and Social Development 2004, the government has put greater efforts in conservation of resources and environment, and achieved a certain extent of progress in effective use of resources and environment protection. However, the high consumption and wastage of resources still greatly hinders economic development, causing a lot of pressure in environment protection. As a result, our resources and the environment are a price we pay for economic development. Land resources: At present, population in China has reached 1.3 billion, 22% of the world’s total. However, the average farmland per capita is only 1.43 mu, less than 40% of the world’s average. Besides this, the total area of soil erosion is 3.56 million km2, which is 37.1% of the total land in the country. Although management of land resources improved in 2004, which has further halted using farmland for constructions, the situation of farmland conservation is still critical. Water resources: In 2004, the quality of water resources fell while the total water consumption was constantly increasing, leading to a decrease of water resources per capita and further revealing the conflict between supply and demand of water resources. The amount of water resources per capita was 1,850 m3, a decrease of 12.9% from the previous year. The annual average rainfall was 609 mm, a decrease of 4.5%, but the consumption per capita was 426 m3, an increase of 3.4%. In the whole country, 79 cities suffered from water shortage, with 23.4 million people and
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13 million large farm animals in temporary shortage of drinking water. From these figures, it is obvious that shortage of water resources exists in China. Therefore, more efforts should be put in proper planning and conservation of water resources, promoting the water-saving society as well as implementing more preventive measures against pollution. Eco-construction: The result of the Sixth Census on Forest Resources of the Country in 2004 reveals that the total area of forests was 0.175 billion hectares, covering 18.21% of land; the total area of live trees was 13.62 billion m3 while the total forest resources area was 12.46 billion m3. Despite the fact that the condition of growth for forest resources is good, there remain such problems as insufficient total areas, irrational structures, unbalanced supply and demand as well as damages. Energy: Preliminary assessment shows that the total consumption of energy was 1.97 billion tons of standard coal, an increase of 15.2% from the previous year. As coal is the main energy resource in China, its consumption still comprises a large proportion of the total energy consumption, and the amount was 1.87 billion tons, an increase of 14.4% from the previous year. Among the major raw materials, steel, consumption of aluminum oxide and cement were 15.1%, 9.7% and 12.4% more than the previous year. These figures show that in a certain period to come, our energy structure – the traditional development pattern – will still rely mainly on mineral resources with high cost, high consumption, high pollution but low production. It will bring great challenges to the air, especially after “Kyoto Agreement” became effective on 16 February 2005. The agreement aims to impose restrictions to developed countries on emitting greenhouse gases, control global warming and protect the air. In the long run, there will be great pressure on China. Therefore, it is essential for China to change the energy structure sooner, put more effort in developing circular economy and move on towards building a conservation-type, new industrialized society. Air in the environment: There were 319 cities being monitored. Air quality of 132 cities was reported to have reached the 2nd grade of the standard in 2004, comprising 41.4% of the total number of specimens, the same as the previous year. Air quality of 119 cities was at the 3rd grade, 37.3% of the total and an increase of 5.5% from the previous year. Also, there were 68 cities in which air quality was considered the third on the low end of the scale, a decrease of 5.5%. Since more effort has been put in improving the overall city environment, the quality of air is gradually turning better. Environmental noise: In 2004, noise pollution in 328 cities was monitored. 2.1% of the cities were found to have severe noise pollution, 5.2% were at the middle of the scale while 9.1% had mild pollution problem. At present, the quality of environmental noise has become better, but not the traffic noise, which remains the major cause of noise problems in the cities.
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Natural disasters: China is one of the few countries in the world where the most acute natural disasters take place. Every year, there are different natural disasters such as severe weather conditions; floods; earthquakes; calamities in oceans, agriculture, forests and ecology, etc. In 2004, economic loss directly resulted from floods and droughts was $97.5 billion, which was already 50% less than the previous year, while the number of casualties from floods and coastal storms was 1,282. In the same year, damaged agricultural area totaled 37.106 million hectares, 31.8% less than the previous year, while 4.36 million hectares of it yielded no crops, a decrease of 49%. At year end, it was reported that direct economic loss from ocean disasters was around $5.4 billion, a decrease of 32.6% from the previous year. All these figures show that disasters during 2004 were less severe than before, as a result of China’s increased strength to fight against them. 1.3 The Initiative of New Industrialization At present, the population in China is more than the total of the world’s industrialized countries. Resources per capita, however, are not enough for realizing industrialization in a traditional pattern. Moreover, the ecological and environmental problems accompanying this pattern of industrialization are too heavy a burden for China. On the other hand, in order to completely alter our country’s extensive type of economic growth, it is necessary to devise an innovative way of industrialization. For many years, one of the major economic tasks for the central government has been exploring a new way of economic development. The Third Plenary Session of the Eleventh CPC Central Committee resolved that “all economic activities must bring economic efficiency.” In The Twelfth Party Congress, it was concluded that “all economic work must gear towards heightening economic efficiency.” Later in The Thirteenth Party Congress, it was clearly stated that “economic constructions shall depend on scientific advances and aim at enhancing the quality of workers.” Furthermore, The Fourteenth Party Congress aimed at “increasing the share of scientific advances in economic growth and turning an extensive type of economy into an intensive type.” The Fifth Plenary Session of the Fourteenth CPC Central Committee made a recommendation on “The Ninth Five-Year Plan” which pointed out that China should “facilitate a sustainable, fast and sound development of the economy, and the key to success is to undergo two fundamental changes which affect the whole process of growth.” One of the changes was “turning an extensive type of economic growth to an intensive type of economy.” Again, The Fifteenth Party Congress reiterated the need to “change the type of economic growth, and alter the situation of high investment, low production, high consumption but low efficiency.” In fact, the concept to treat scientific advances as a key factor in economic growth has not really taken root. Whenever macro-economic regulation was implemented, the problems were temporarily relieved. However, the situation rebounded after a while, and the problems of ecological disruption, environment pollution as well as resource wastage were becoming more serious.
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After serious consideration, the Sixteenth Party Congress recommended “taking a new route of industrialization” in the new century; the Third Plenary Session of the Sixteenth CPC Central Committee also pointed out that it was important to introduce a new concept of scientific development and adhere to it in the new development phase. New industrialization is in fact essential for building a harmonious society; it is not only an innovative input in the process of China’s industrialization, but also in economic growth as well as being central to the notion of development and modernization. The report of the Sixteenth Party Congress explicitly pointed out “the road ahead for industrialization was with no ease when China is being modernized.” In order to speed up the process of industrialization and modernization, the only choice for China is to go for informatization. Informatization and industrialization are mutually reinforcing, and this path of new development would embrace high technologies, pursue high-economic efficiency, low-resources consumption and optimize human resources but make less environment pollution.” In comparison with traditional industrialization, “new industrialization” has the following characteristics: ? It is spurred on by informatization ? It strengthens sustainability ? It fits into the Chinese context, and makes the best of the advantages of China’s human resources ? It enables the market and the government to function effectively ? It brings justice to the society ? It promotes harmonious co-existence of human and nature 1.4 Circular Economy – the Core of Modern Industrialization in China The first task of the next phase of economic development in China is to speed up the development of new industrialization and to make the economy and society develop in a sustainable way. At present, China is under the pressure of scarce resources and environment protection. Learning from the experiences of international economic development, and making reference to the global economic development trends, China must speed up the process of developing circular economy and make decisive turn of its economic growth pattern. Moreover, there is an urgent need to build up a “resources-saving” and “ecology-conservation” type of society, and release the pressure of resource constraints and environmental issues that China encounters in the course of the development of the “well-off society”. In contrast to traditional economy, circular economy is characterized with low consumption of materials and resources in the course of production, low pollution level, high efficiency and high circulation rates, enabling resources to be put to full use during production. As a result, the adverse effects of economic activities on
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nature will be decreased as much as possible. Therefore, circular economy achieves economic development, environment protection and resource saving in one goal. Its peculiar feature is resource saving and recycling, making it an essential choice for China if she wants to change the economic growth pattern from an extensive one to an intensive one. The constraints in China’s future economic development are mainly the problems concerning resource and environment support; issues concerning about the status of land resources, mineral resources and water resources as well as the stringent supply-demand relationship have to be addressed. For a sustainable, fast and sound development, and achieving the target of building a well-off society in 2020, China must resolve the problems of resource and energy stringency. This highlights the need of developing circular economy to rationalize resource and energy usage in a better way. 2. Circular Economy and Ecologicalization of Enterprises
2.1 Ecologicalization of Enterprises Currently there are two changing forces in the world’s economy – knowledge-based development and ecologicalization of economic development. The latter means that economic activities of employing natural resources will be subject to ecological rules and will be environmental friendly. The two forces are complementary and mutually reinforcing, thus creating an irresistible historical trend towards ecologicalization of enterprises. Circular economy is a kind of “system engineering” focusing on economic production. It takes into consideration the conflicting demand between economic development and environmental protection, and shall become the mainstream of economic development. In industrial production, enterprise is the basic economic unit. It is also an important force in solving the problems of environment pollution, so it is the place where any development for circular economy shall start with. An enterprise as the core unit of industrial economy shall transform and adjust its production mode, operation and development strategies in response to the new trend of economic development. In short, ecologicalization of enterprises is the embodiment of the paradigm of circular economy. For an enterprise, it is necessary to take care of both economic efficiency and environmental efficiency to achieve sustainable development. In other words, it is a change from an extensive mode of development to an intensive mode. The best way to change is through ecologicalization of enterprise, which is realized in saving energy, reducing consumption and pollution, as well as increasing efficiency of enterprise. Moreover, it is necessary to change the mode of pollution control from the end control to one throughout the whole production process.
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Ecologicalization of enterprise comprises ecologicalization in resources, products, skills and management model. However, these various parts of economic activities are not separate but taken as a whole. Close-end circulation applied in only one production segment or some parts of the economic activity should not be considered successful. In general, ecologicalization of enterprises includes the following categories: Eco-resources: Employment of resources in a production mode shall be organized in below: ? Encouraging enterprises to adopt “green acquisition”, purchasing raw materials which will cause “zero” or only slight pollution, saving raw materials and energy, and abandoning the use of toxic raw materials to minimize environmental pressure on the upper chain of production. ? Improving the way of using energy; making better usage of energy; developing ecological skills that can use energy in a better way; gradually reducing the use of materials of high carbon content; using non-mineral fuels; using solar energy, wind energy, terrestrial heat, nuclear energy and biological energy more frequently to realize the aim of “energy without carbon”. ? Making wastes as resources; an enterprise can develop new skills to collect “wastes” which have renewable value; it can also set up new enterprises, using “wastes” as resources for economic production so that the wastes generated from every step of production can be reused. Eco-products: Eco-design is a production mode subscribing the principle of resources circulation. A product is designed in such a way that it can be disassembled, recycled, conserved, reused and so on to prolong its life span and increase frequency of its usage. Once the product loses its function, it can be recycled to turn into useful resources and be used again in another chain of production. In so doing, the usage rate of resources is increased. For example: ? Researching and developing environmental friendly products, as well as abandoning as soon as possible outdated technologies and products which consume a lot of energy, materials and water. In product design, it is important to pay full attention to recycling of materials, and make energy saving as well as reduced consumption a requirement. Moreover, improvement must be made for product design so as to reduce “pollution by consumption” caused by the products during production or everyday consumption. ? Enhancing the product’s capacity for upgrading to the next new green generation. ? Using simple product packaging, recyclable and reusable materials or containers.
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Eco-production skills: The essence is using a close-end circulation with zero or little wastes, and production skills which save energy, consume little but work well shall be promoted. The wastes produced in one production process can become resources for another process, so pollutants are absorbed in the production cycle. Moreover, new production technologies should replace outdated facilities that use backward skills, require high investment, cause serious pollution and produce poor quality of products. In addition, more investment should be made in technology innovation for combining new technology development with traditional technology improvement. Eco-management: Encouraging enterprises to acquire ISO14000 certification, so that they can apply environmental management to their daily operation, facilitating coordination between protection of ecological environment and economic development. More efforts should be put in promotion of ecologicalization to different aspects in the enterprise, including ecological education to the administration and their staff, upgrade of their relevant skills, modulation and control of their work processes, behaviour as well as life style. 2.2 Eco-enterprises – Case Study 2.2.1. A Case of Clean Production
In the ecological city development and circular economic development plan of Changshu City in Jiangsu Province, the case of Changshu Shi Iron Red Co. Ltd. is cited as an example of clean production. This enterprise does not have high skill level and their products do not have high-technology content. Through development of clean production, reformation of the bottleneck section in the production process, improvement of skills and facilities, as well as replacement of raw materials, they have achieved circulation of materials both inside and outside the factory. As a result, efficiency in using water resources and energy is increased, achieving economic, environmental and social efficiencies. Profile of the enterprise Changshu Shi Iron Red Co. Ltd is a paint manufacturer in the chemical industry, manufacturing mainly iron oxide paints, including iron oxide yellow, black and red, as well as other kinds of iron oxide. Diagram 1 shows the integrated use of different materials and wastes:
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Diagram 1
Integrated Use of Different Materials and Wastes in Changshu Shi Iron Red Co. Ltd.
Achievements of the clean production include: ? Recycling the by-product of titanism dioxide factory to produce ready-made ferrous sulfate. The major raw materials for the manufacturing of iron oxide yellow and iron oxide black in the company are ferrous sulfate, iron (III) oxide semi-finished product and liquid alkaline. Usually ferrous sulfate is manufactured with purchased materials – sheet iron and sulfuric acid, through reaction process. However, the supply of sheet iron is getting tight, and the price is going up. Also, the reaction process will produce a slight amount of acid mist which damages the environment in some way. Although it is able to conform to the emission standard after the neutralization and absorption processes, it will be at the cost of higher consumption of
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energy and liquid alkaline. On the other hand, solid ferrous sulfate is a by-product produced in the titanium dioxide factory (and also a major industrial solid waste), and the quantity is large. Therefore, the company can make use of this ready-made by-product instead. Compared with manufacturing the ferrous sulfate, using the by-product does not only incur less production cost (only transportation cost is involved), but also decrease the acid mist emission during ferrous sulfate manufacturing; at the same time, it is a good way of recycling the industrial solid wastage in the titanium dioxide factory. Investment in technology in this project costs only 70,000 RMB. After its implementation, the project saves about 450,000 RMB in 2002. Moreover, emission of three wastes during manufacturing has been reduced, and there incurs no expenses in solid-waste treatment and the charge for burying wastage. ? Using acid-base transfer sewage sludge produced during wastewater treatment in the iron oxide manufacturing process to manufacture iron oxide black. The wastewater produced during the iron oxide manufacturing process contains mainly pollutants such as Fe2O3, FeSO4, 7H2O and soluble salts. After being handled, the iron oxide and ferrous sulfate in the wastewater are settled and collected for pressing and filtering to become such mixture as Fe2O3 and Fe(OH)2 (acid-base transfer sewage sludge). The mixture usually contains 75% water and can be used in synthesized production of iron oxide black to manufacture iron oxide black products that meet clients’ requirements. After carrying out the project, direct economic value in 2002 reached 850,000 RMB. In addition, the skills applied to the project are operable and reliable; the original manufacturing facilities need little adjustment, and the products are accepted by clients. The economic and environmental efficiency of the project is outstanding since the burden of wastewater disposal charge can be greatly relieved, while the normal operation of it is ensured, and emission of pollutants constantly complies with environmental standard. ? Good Quality of Coal is Used in Boiler Room
Changshu Co. is equipped with boiler room to produce steam for manufacturing iron oxide yellow and iron oxide black. The fuel used is good-quality coal with low sulfur content (containing S<0.2%) and high heating value so as to increase the steam output rate of the boiler. At the same time, emission of SO2 and dust is reduced. In spite of the higher cost of good-quality coal, installation and sample trial costs for de-sulfurizing smoke can be saved. The company can use multi-cyclone dust collector to meet the emission standard, resulting in high environmental efficiency.
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On the other hand, the coal cinder and fly-ash cement thus produced are all sold to kiln factories for making bricks, bringing in 45,000 RMB direct profit. 2.2.2. A Case of Turning Wastes into Resources
Profile of the enterprise Located in Taicang City, Xin Tai Alcohol Manufacturing Co. Ltd. is an alcohol manufacturer in the chemical industry, using cassava as raw material. Its annual production is more than 50,000 tons, including 10,000 tons of anhydrous alcohol, 30,000 tons of good quality cooking alcohol, 10,000 tons of medicated alcohol, 1,000 tons of sterilization series bottled alcohol, 20,000 tons of carbon dioxide and 12 million m3 of methane. There are three major departments in Xin Tai Co., namely alcohol manufacturing, energy supply and sewage disposal. In developing the project of clean production, all the three departments cooperated closely in making use of all the resources and energy in better integration, forming a compact organic unit, and that process fully reflects the concept of circular economy. Diagram 2 shows its chain of circulation:
Diagram 2: Structure of Circular Economy of Xin Tai Alcohol Manufacturing Co. Ltd. 11

The specific measures and benefits of turning wastes into resources are as follows: ? Methane and Sludge Produced in Distiller and Alcohol Manufacturing Can be Used by Boiler for Making Fuel During the whole process of sewage disposal, methane –produced by anaerobic fermentation – is a kind of green energy, while the sludge dissolved daily also has certain value. The methane and the sludge can be used by energy supply department. They can be mixed with coal for burning in the boiler so as to reduce consumption of raw coal. In calculation, the fixed cost for this project is 27 million RMB, while annual operation cost is around 4 million RMB (cost for sewage disposal). The project has brought about saving on coal as well as direct annual economic contribution of 6.9 million RMB. Moreover, it has also helped reducing emission of SO2 and dust, and economizing on the costs for de-sulfurizing, sample trials, as well as transporting sludge for disposal. Despite the fact that return on investment will take longer, it is an integrated circular economy project that encourages recycling, integrating, reusing and reproducing materials and resources. It creates benefits and makes redevelopment sustainable, so it is a case worthy of promotion in the industry. Furthermore, since 2004, a charge system according to the consumption of coal has been introduced in Suzhou. Xin Tai Co. will actively explore ways to achieve the best result – for increasing production of methane as well as decreasing consumption of raw coal and the payment incurred – to bring about a better future for the promotion of this project. ? Methane Produced During Sewage Disposal Can be Used for Generating Electricity Directly Methane produced during sewage disposal can all be injected into two 20-tons-per-hour boilers for burning, after which electricity is generated through a 1,500-kilowatt-per-hour backpressure turbo generator unit. Nevertheless, energy loss in this process is rather large. Using methane directly for this process will obtain higher economic and environmental efficiency. Currently, Xin Tai Co.’s collaboration with the Ministry of Science and Technology, Sichuan Chengdu Methane Research Centre and Jinam Diesel Oil Machine Company is in progress, carrying out an experiment in operating a methane electricity generator with the highest power (700 kilowatt/hour) in China. In money term, the fixed cost for this project is 21.3 million RMB while the annual operating cost is around 1 million RMB. Assuming 20% of the methane produced is used for burning and 80% for electricity generation, the annual direct
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profit will be 10.8 million RMB, far more than that from using methane for burning in boiler. This project does not only bring about shorter run return on investment, in addition to higher economic efficiency, but also serves as a driving force for research and experiment in the innovation of advanced facilities and equipment. The R&D will then benefit the industry in general. ? Development of Green and Ecological Parks
The raw materials used for manufacturing alcohol are mainly foodstuff containing starch. The solid wastes produced do not contain any toxic substance such as heavy metal. They are thus suitable for processing for further usage. Likewise, the alcohol lees solution becomes lees and clear solution after being processed with a centrifuge, and the lees can be used as feed. At present, Xin Tai Co. is collaborating with the Soil Research Department of Shanghai Agricultural Institute in developing how to use the sludge obtained from the anaerobic process to make organic/inorganic compound fertilizers and soil improver. Besides using these products for planting green vegetables, there is also a good opportunity to develop green, ecological parks. Moreover, the company and Hangzhou Ecological Environment Research Institute are making use of grass seeds fertilized by sludge, and it yields good results. The fixed cost for this experiment is 3.20 million RMB while the annual net profit can reach 1.7 million RMB. Short run return on investment is impressive. Furthermore, green agriculture is a rising industry with high market demand and development potential. Last but not least, the project also helps improving the image of the enterprise. 2.2.3. A Case of Advanced Environmental Management
UPM-Kymmene (Changshu) Paper Industry Co. Ltd., an international group of companies equipped with state of the art technologies, is chosen as a case in this paper for its excellence in reducing consumption of materials and energy for recycling and reuse. Its ecological design of products and its advanced environmental management is impressive. In 2003, UPM was awarded “The One Hundred Best Industries in Environment Protection in China”. UPM is solely owned by UPM-Kymmene Group in Finland, one of the largest forest products groups and paper industry companies in the world. It is UPM-Kymmene Group’s largest investment and the largest single investment project in China. Its main products are chemical wood pulp neutral copy paper, chemical wood pulp double-sided tape and chemical wood pulp matt paper, etc.
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The main measures in environmental management are: ? Recycling of White Water
White water recycling is the major measure for the paper-making machine to reduce emission of wastewater and loss of fibre. Some of the white water on the net is for diluting pulp in the white water trough and the fan pump, and the rest drains to the white water tank for filtering, so the multi-tank recycling machine is a better equipment for the treatment of white water. As a result, the super-clear filtered water can be used as various kinds of wet-end spray water or diluting water for some kinds of chemicals, while the clear filtered water can be used as pulverization diluting water, slurry density control diluting water and drainage. Finally, the cloudy water can become drainage and diluting water for damaged paper and pulp, short cycle diluting water for pulp, as well as cleaning water for various selecting machines. In this way, the reusage rate for white water can reach more than 90% while the loss rate for fibre and stuffing is less than 1.1%. ? Clean Products
UPM’s fine paper is manufactured with imported pulp as raw materials, and the manufacturing procedures include preparation of pulp (pulp making), paper making, coating and finishing. Its quality is better than that of the static copy paper manufactured by off-set paper machine. During the life cycle of the product, namely raw materials acquisition, production, sales, as well as utilization and disposal, careful consideration is made on ecology, health and safety. The raw fibre material that UPM uses is commercial chemical pulp, so no chemical pulp-making process is required. Compared with using wood pulp as raw material for making pulp, it reduces more than 70% of clear water consumption and more than 90% of water pollutants. Likewise, in comparison with using waste paper as raw material, it reduces 40% of clear water consumption and more than 70% of pollutants. Moreover, it results in reducing energy consumption. A comparison is shown in the table below.
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Table 1 Materials and Energy Consumption Rate in Paper Making
Raw materials wood pulp (LKP) waste paper (DNP) commercial pulp Consumption of clear water (M3/T product) 170 45 25-30 CODCR (KG/T product) 140 57 15-24 Standard coal (T/T product) 1.5 (pulp paper enterprise) 0.7-0.8 0.6-0.7
From the above table, it is obvious that using fine commercial wood pulp basically guarantees low pollution in paper industry. In paper making, it is necessary to use a lot of different chemicals. What UPM is using are non-toxic or only slightly toxic substances, basically causing adverse effect on neither the environment nor human health. The total energy consumption of the production line is 0.58 tons of standard coal per one ton of product. The total production and total energy consumption in China’s paper industry is 1.88 tons of standard coal; for some large paper-making companies in China, the rate would be 1.67 tons. UPM’s performance is indeed outstanding and up to international standard. ? Environmental Management System
To support the forestry industry in China and protect Changshu’s ecological environment, UPM imports 80% of the raw wood pulp from Finland. Moreover, UPM-Kymmene (Changshu) has already acquired certification of ISO14001 on environmental management. UPM employs full-time environmental manager who is responsible for the operation, development and analysis of (products’ or the environment’s) life cycle as well as submitting environmental report of the region. Furthermore, professional staff in each sales office is designated for dealing with environmental issues while experts are consulted in project development. In addition, UPM organized conferences on environmental issues in Beijing with the objective of explaining the company’s environmental strategies – ensuring purchase of wood meets the compliance with the requirements for sustainable economy, ecological and social developments. At the same time, public opinion was sought for the betterment of the company.
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3.
Circular Economy and Eco-industrial Park
3.1 Eco-Industrial Park According to the United Nations Environmental Programme (UNEP), industrial park is a large area in which industrial enterprises assemble. It has the following features: a large area of land is developed (usually larger than 40hm2); there are many buildings, factories, various public and entertainment facilities; regulations are applied to resident companies, land use and type of buildings. Comprehensive regional plan sets out standards and conditions on the park’s management, including specifications on contracts and agreements, controlling entry of enterprises, as well as setting up long-term development strategies and plans. Industrial park is an important element of development strategy in many countries, and its function in promoting economic growth is irreplaceable. However, while industrial park facilitates rapid development of industry, it has also caused serious effects and disruptions to the environment. With development of industrial parks, environmental problems emerge. These problems include: 1. concentration of environmental problems of individual enterprises in one comparatively small region; 2. extra effects on infrastructure and services of the park; 3. problems in transport development, fuel supply and sprawl of building construction; 4. extensive use of land that affects ecological values, urban development, entertainment and travel; 5. although some enterprises are complied with environmental requirements, waste disposal exceeds capacity allowed, thus creating new pressure for building public facilities for pollution treatment; 6. possible effects of pollution on the local region. 7. Generally countries with industrial parks lack direct and effective environmental strategies. Some of the developed industrial parks are more concerned with economic efficiency than ecological efficiency. Many resident enterprises, despite realizing the importance of the environment, still stay at the stage of “end-of-pipe treatment”, with no solution for pollution problems. In the end, heavy investment in industrial parks only causes more wastes to the environment, deteriorating ecology and draining resources. In conclusion, efficiency of industrial park is low, but its cost is high.
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3.2 Eco-industrial Park – Case Study Eco-industrial Studies serves as a guide for development of industrial parks. Instead of providing minimum services (such as centralization of waste treatment and sewage disposal system), authorities of industrial parks should view ecological system as a model and work from the basis, pushing enterprises to increase energy efficiency, decrease resource consumption and develop clean production. On the other hand, enterprises should cooperate in different areas for overall excellence and minimum wastage, with the aim to become an eco-industrial park. It is the scenario of development of industrial parks in China, although the scopes, types and measures may differ. The general situation is as follows: 3.2.1. A Case of Eco-industrial Park with a Core Enterprise
Profile of the Park Guigang State Eco-industrial (Sugar Refinery) Demonstration Park is the first state eco-industrial demonstration park in China, approved for establishment by State Environment Bureau in August 2001. The core establishment in the park is Guangxi Guitang Group Ltd. Through setting-up eco-industrial park, Guitang Group has restructured its industry chain and structure, solving the problems of structural and regional pollution that are common with traditional sugar refinery industry. Guitang Group uses renewable energy sources unique in the region – sugar cane – as a basis to develop sugar refinery, and uses the main wastes of sugar refinery – sugar cane bagasse and cane sugar – for paper mills and alcohol industry, establishing a good eco-industrial chain, and meeting the zero-emission standard in the region. Guigang Sugar Refinery’s eco-industrial system is composed of six sub-systems (or units). The general structure is shown in Diagram 3.
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Sugar cane field system Sugar cane Cane sugar Organic sugar cane Waste molasse Alcohol system
Composite fertilizer
Sugar manufacturing system
Reused water
Sugar; Organic sugar; Oligofructose
Alcohol Yeast extracts
Diagram 3: General structure of Guigang State Eco-industrial (Sugar Refinery) Demonstration Park
Below is the main eco-chain of the park: ? Sugar Cane – Sugar Refinery – Industrial Chain of Paper Manufacturing with Sugar Cane Bagasse The sugar cane from sugar cane field system is imported in sugar manufacturing system for making various sugar products. The sugar cane bagasse produced during sugar manufacturing process is fed into paper manufacturing system as major material for pulp-making industry. That process is a typical industrial chain of sugar industry in China, and the most economical industrial chain in Guigang Sugar Refinery. ? Sugar Refinery – Alcohol Manufacturing with Cane Sugar – Industrial Chain of Composite Fertilizer Manufacturing with Alcohol Waste Liquid The waste sugar from sugar manufacturing system is used as a resource for alcohol manufacturing, producing alcohol-based energy or edible alcohol. The alcohol waste liquid from the alcohol system is used for making composite fertilizer after being condensed, dried and supplemented with necessary nutrients.
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Cogeneration system
Steam Electricity Sugar cane bagasse Paper manufacturing system Sugar cane bagasse pulp; Paper; CMC Waste dregs Waste liquid Waste air Integrated environment treatment system Recycled alkaline
De-dusting and de-sulfurizing, Cement, Calcium carbonate light, composite fertilizer Recycling of alkaline White water recycling and waste reuse

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Sugar Refinery (Organic Sugar) – Industrial Chain of Oligofructose
The materials for manufacturing oligofructose can be intermediate products such as cane sugar, red sugar, molasses, alcohol waste liquid, syrup and clear liquid produced from sugar refinery. These products are made after being concentrated, purified and sterilized through immobilized enzyme fermentation. ? Sugar Cane – Sugar Refinery – Paper Manufacturing – Cogeneration Plant
The sugar cane bagasse from sugar refinery is inputed as fuel in cogeneration plant. Wastewater (alkaline) from paper manufacturing is de-dusted and de-sulfurized before being put together with the sulfur smoke (acidic) in the cogeneration plant for neutralization. Steam and electricity are then provided for all industrial plants, while cooling water is transported into the paper-manufacturing system. Moreover, the fly-ash cement from the boiler of cogeneration plant is a good sorbent for wastewater treatment in paper mill. ? Water Supply, Utilization, Recycling and Emission
Reuse of water is facilitated through recycling of cooling water and condensate, separation of filtered residue, slag and sludge, as well as treatment and control of pollution’s origin. The cooling water and the condensate can be reused after treatments such as cooling and aeration. On the other hand, white water from paper mill can be recycled and returned to relevant production plant after treatment. ? Integrated Utilization of Filtered Mud, White Mud and Waste Dregs as well as By-product Production Various solid wastes such as filtered mud, white mud and waste dregs produced during different manufacturing processes can be reused after appropriate treatments and be made into by-products. For example, the filtered mud (after piling) from sugar refinery and the white mud from paper-pulp-making process can be used for cement manufacturing, while the latter can also be used in manufacturing calcium carbonate light. On the other hand, the floating residue from traditional carbon sulfate treatment can be used by composite fertilizer manufacturing in alcohol factory; the fly-ash collected from the boiler of cogeneration plant can become sorbent for wastewater treatment. Both the fly-ash and the sewage sludge from wastewater treatment are good fertilizers for sugar cane.
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General Benefits Brought by the Park are Obvious
Paper manufacturing with 200,000 tons of sugar cane bagasse can save 600,000 – 660,000 m3 of lumber consumption; for 200,000 tons of fuel alcohol manufacturing, an annual saving of 600,000 tons of corns can be achieved; while reuse of white water from paper mill can save 15.84 million tons of fresh water annually, and reduce water pollution substantially. In the park, around 93% of waste molasses in Guangxi is used for energy alcohol manufacturing, which can reduce emission of about 93% of alcohol wastes in Guangxi. According to preliminary assessment, it will directly reduce emission of 134,000 tons of toxic substance and 22,000 – 30,000 tons of COD every year. In conclusion, Guigang State Eco-industrial (Sugar Refinery) Demonstration Park has succeeded in integrating the exchange of resources, energy and industry information inside or outside the Park, making the best of eco-functions of various industrial chains in a regional scale. Moreover, it has achieved maximum utilization of regional resources and minimum pollution of the environment, basically reaching the target of zero pollutant emission in the region, as well as attaining substantial integrated economic, environmental and social efficiencies. 3.2.2. A Case of Eco-industrial Park with Multiple Lines of Business
Profile of the Park Shanghai Xinzhuang Industrial District is a municipal-level industrial district approved for establishment in August 1995 by the Shanghai government. Situated in Minxing District, it has a developed area of 17.88 km2, of which 68% is developed for industrial use. It is also the first industrial district to have passed the audit of ISO9001 (Quality Management System), ISO14001 (Environmental Management System) and OHSAS18001 Certification (Occupational Health and Safety Management System). After ten years of development, the structure of the industrial park has built on three pillars of industries in the district, including microelectronic communications, mechanical and vehicle accessories, as well as new materials and fine chemicals. The organization of 2010 World Expo in Shanghai and the policy goal to create an eco-city offers a good opportunity for the Park to proceed to a new phase of development. A development plan of Xinzhuang Eco-industrial Park was made in 2005, with the aim of promoting innovation in technology and management system
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