ADB signs $250m loan agreement for geothermal heating development in China
In a groundbreaking deal, the Asian Development Bank (ADB) signed loan facilities of $250 million to Icelandic-Chinese Joint Venture by Arctic Green Energy Corporation (AGE) and Sinopec Green Energy Geothermal Company Limited (SGE) to expand geothermal district heating services in China.
As announced this morning, the Asian Development Bank (ADB) signed facilities of a total of $250 million in loans to Arctic Green Energy Corporation (AGE) and Sinopec Green Energy Geothermal Company Limited (SGE) to expand environmentally sustainable district heating services in the People’s Republic of China (PRC).
Coal-based heating is one of the major causes of air pollution in the PRC, including in the Bejing-Tianjin-Hebei region. Goethermal district heating extracts thermal energy from beneath the earth’s surface for delivery to households and business through dedicated pipelines. It offers an alternative which is sustainable, stable, and cost-competitive to coal and gas, has zero-emissions, and can be integrated into existing networks to replace heat sources.
“This is a landmark project for Asia. Geothermal district heating can provide millions of citizens with safe and stable heat access while dramatically reducing air pollution and greenhouse gas emissions and the reliance on fossil fuels,” said ADB Vice-President for Private Sector and Cofinancing Operations Diwakar Gupta. “Our partnership signed today in Iceland, a country whose own energy system shows the potential of geothermal, will deliver much-needed energy solutions that promote truly sustainable development.”
“How cities are heated or cooled in the 21st century will determine the outcome in the fight against air pollution and greenhouse emissions,” said SGE Vice Chairman and AGE Chairman and Founder Haukur Hardarson. “The funding from ADB enables AGE and SGE to significantly expand in the fight against air pollution while providing much needed clean heating to the citizens in the PRC. We see ADB as a long-term strategic partner and look forward to work also with other countries in Asia such as Kazakhstan.”
“Joining hands with ADB will help strengthen our long-term partnership on sustainable geothermal development to fight against air pollution and reduce greenhouse emissions. We aim to replicate our successful collaboration across Asia,” said SGE Chairman and Sinopec Star Vice President Liu Shiliang.
AGE, based in Iceland, is a leading global developer and operator of renewables, including geothermal technology and energy efficiency projects. The company’s mission is to export Icelandic expertise in geothermal and renewables to fast growing countries in Asia.
SGE, established in 2006, is the world’s largest geothermal district heating company by service area. It is a joint-venture between AGE and Sinopec Star of Sinopec Group, also known as China Petrochemical Corporation
ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, it is owned by 67 members—48 from the region.
Source: ADB Press Release