The development of low-carbon heating industry is picking up pace. Recently, several departments of the central government paid attention to winter clean heating in northern China, and several key cities have issued specific policies and implementation plans to support the development of companies in the clean heating industry.

On June 22nd, the Ministry of Finance, the Ministry of Housing and Urban-Rural Development, the Ministry of Ecology and Environment, and the National Energy Administration jointly held a meeting on providing financial support for winter clean heating in northern China. The meeting stressed that clean heating is not only an important measure to improve people's livelihood, but also an important task to undertake to fulfill the goal of "carbon neutrality and carbon peaking", as a result, it is necessary to continue to promote the development of winter clean heating in northern China.

The meeting asked local governments to shoulder their due responsibility and actively promote the implementation of the project, strengthen financial support, build a diversified and market-oriented investment mechanism with the guidance of government funds and the participation of enterprises, residents and social capital, strengthen organizational leadership and overall coordination, implement the arrangements of the CPC Central Committee and the State Council, to greet the opening of the 20^th National Congress of the Communist Party of China. At the meeting, leaders of the Finance Department of Hebei Province, Yantai of Shandong Province, Datong  of Shanxi Province, Yinchuan of Ningxia Hui Autonomous Region, Shenyang of Liaoning Province and Shangqiu of Henan Province made speeches.

To fulfill the goal of “carbon neutrality and carbon peaking”, clean heating has become one of the important ways to save energy and reduce emissions, and there are good prospects for the development of clean heating. The "Plan for Renewable Energy Development during the 14th Five-Year Plan" prescribes that by 2025, the scale of non-electric heating such as geothermal heating, biomass heating, biomass fuel and solar heating will reach more than 60 million tons of standard coal.

To implement the clean heating policy, local governments across the country have issued specific policy plans and implementation plans of this year. For example, Beijing, Shenyang, Tianjin and Shanxi province, which are located in northern areas with huge demand for heating, have set the goal of replacing traditional heating with clean heating, and some areas have provided special funds or financial funds for fulfilling this goal.

Shenyang, for example, is located in China's severe cold climate zone, with a heating period of 151 days. According to statistics, since 1951, the minimum temperature in the downtown area of Shenyang was -32.9℃, and the minimum temperature in its suburbs was -35.4℃ in recent years. As a result, heating in winter is indispensable to people's livelihood.

The "Plan for Urban Civil Heating in Shenyang during the 14th Five-Year Plan" proposes that by 2025, the proportion of clean heating and clean energy heat supply will reach 100% and 20% respectively. According to the resource endowment and energy condition in Shenyang, it will give priority to utilizing natural gas, electric heat storage boiler, ground water source heat pump, sewage source heat pump, biomass and other clean energy heat supply to fill the gap in coal-fired heating and meet the need for heating.

Shenyang government provides financial support to achieve the above goals. It proposes to invest CNY 41 billion in clean heating projects during the 14th Five-Year Plan period, especially in projects such as "replacing coal with gas", "replacing coal with electricity", photo-thermal+,photovoltaic+breeze, biomass and clean stove heating. It will make good use of the special funds of CNY 2.1 billion and the financial aids of CNY 4.2 billion from local governments. In 2022, it plans to carry out projects such as ultra-low emission renovation of large coal-fired boilers with a capacity of 100 steam tons and above, renovation of clean heating device using coal for 64,000 rural households, and renovation of clean energy heating in 18 township-level units.

The policies of the central and local governments have brought benefits to listed companies in related fields. In the field of clean heating, Luen Mei Quantum (600167.SH) has built a pattern of coordinated development of a variety of green and low-carbon technologies, such as clean coal-fired high-efficiency cogeneration, reclaimed water source heat pump heating, biomass cogeneration and natural gas distributed combined cooling, heating and power supply. Besides, it actively branches out into new fields such as electric energy storage and hydrogen energy to provide users with green, efficient and intelligent products and technical solutions. It leads the industry in terms of its energy consumption and pollutant emission of its heating business, and its proportion of clean heating has reached 100%.

The water source heat pump heating business of Luen Mei Quantum is also worthy of attention. It is the first in China to combine the water source heat pump technology and steam waste heat for heating. The total heat utilization rate of its circulating water system is more than 100%, with remarkable coal-saving effect, high utilization rate of waste heat and no emission, producing good social, environmental and economic benefits. The total heating capacity of related projects exceeds 120 MW, and each year, 13,000 tons of standard coal and 35,000 tons of carbon dioxide emissions can be reduced.

In field of biomass energy, Luen Mei Quantum also has obvious technical advantages. Located in Taizhou Pharmaceutical High-tech Industrial Development Zone, Jiangsu Province, Luen Mei Bio-energy, as a biomass enterprise that realized cogeneration earlier than other enterprises in China, provides centralized steam heating, power supply and other supporting services for Taizhou Economic Development Zone, Taizhou Pharmaceutical Industrial Park and its surrounding buildings, as well as more than 40 well-known enterprises such as Nestle Health Science, AstraZeneca and Unacon. The project adopts the technology of "combined grate technology + high parameter and high speed unit + cogeneration + ultra-low emission of flue gas", to realize the efficient, clean and low carbon utilization of renewable energy, and its economic, environmental and social benefits are remarkable.

According to the Roadmap for Upgrading Comprehensive Energy Strategy previously issued by Luen Mei Quantum, the company will mainly use renewable clean energy for its new heating business in the future, adopt new renewable energy technologies such as sewage source heat pump, air source heat pump, river water source heat pump, ground source heat pump and deep geothermal energy according to local conditions, and strive to make breakthrough in using hydrogen energy and energy storage. By integrating “self-construction + acquisition + operation management", the company will expand into more markets nationwide to provide clean, efficient, safe and stable comprehensive energy services for more areas. (Source: Securities Times)