what are the characteristics of a livable, productive city to you?

First and foremost, a good natural environment is a must—think fresh air, clean water, and lots of greenery. Then there’s safety, which is crucial, from everyday public safety to being prepared for any potential large-scale natural disasters. Moving on, convenience is key in life, whether it’s for personal needs or family life, from services to work, everything should be a bit more accessible. Lastly, society should have a certain level of diversity and inclusiveness, which is not just about respecting different people but also about embracing various lifestyles and cultures.

how do smart buildings, smart energy, and smart computing verticals improve the life of end users? what do end users want from this type of infrastructure?

I believe that these three areas are closely connected to our daily lives, affecting us in every moment. However, most of the time, end-users like you and me may not know we are using these services.

Why do I say that? Because most of the time we are in a certain space, and as long as it is a space, it falls within the category of buildings. And most of the time we are consuming energy, such as the mobile phones we carry with us, which all have batteries. If we are at home, our household appliances are also using electricity. As for computing, now we have a digital society, and there are a lot of signals being transmitted in the air, which we can’t see, but they do exist.

In fact, I think most people are already using these things, but they are not aware of it. For end-users, the most direct perception might be when they are in a certain place, doing something in a way that feels more comfortable, smoother, convenient, and efficient than before.

you serve an ecosystem: the CEOs of the ventures you support, their customers, prospective developers, municipalities, etc., and their final customers. all entities are aiming to create and experience a more sustainable world.

are they all authentically interested in a sustainable future? or is it an aspiration of the moment?
how does each group feel the commitment?

For me personally, any lasting endeavor must be supported by a viable economic model, no matter whether it’s non-profit or for-profit. As financial investors, we are pursuing financial returns, and we invest in for-profit companies. The companies and founders we collaborate with may be involved in the currently defined ESG/sustainability areas, but the key driver for them lies in whether there is a huge market demand and good business opportunities, which prompts them to invest in talent, capital, and time for technological innovation.

If there is no viable economic model to support a company or an individual to do something, it’s like a castle in the air, which is totally unsustainable. I believe the key is NOT whether these founders truly have a sense of mission or a commitment to create a sustainable future, the key questions we need to understand are whether there are big unmet needs; how urgent/crucial it is to meet these needs; what stage we are at in terms of technology development in certain areas… Many factors together prompt various participants, including entrepreneurs, investors, governments, and end-users, to make their respective choices.

For example, China is currently vigorously promoting the dual carbon goals and pushing the entire economy towards a green transformation. Is this for combating climate change or creating sustainable societies? That is only one benefit. The fundamental driving force is actually China’s pursuit of energy security, which is directly tied to China’s national security. Energy security and the dual carbon goals have become China’s national strategy, thus creating a lot of market demand and opportunities, and nurturing a batch of new energy technology companies.

we often hear about how smart computers and ai will help the analysis and deployment of energy. yet, the infrastructure that sustains smart cities is energy-intensive, and so is the cooling of data centers, server sites, etc.

should we also consider this type of technology as a risk to sustainability, particularly in initial training phases?

to give an example, data centers—excluding cryptocurrency mining—are responsible for 1% of global electricity. is this offsetting gains produced by alternative energies? what strategies are in place to neutralize tech’s impact on sustainability?

I think the first question is, what exactly is sustainability?

The seventeen sustainable development goals defined by the United Nations include two related to energy and climate action, but the first three are to eliminate poverty, end hunger, and ensure good health and wellbeing. Others include providing good jobs and economic growth, reducing inequality, and providing quality education, etc.

A project cannot meet all seventeen indicators at the same time, and it may meet some while not meeting others. I think it needs to be considered comprehensively, and we cannot just focus on one. More importantly, we must take into account regional differences, because different places have unequal social and economic development as well as different cultures.

Coming back to the question, it is actually mainly related to energy. First, I believe that using energy is not a bad thing, but a good thing, because the development of the entire human race is closely correlated with the increase in energy usage. I would consider this question from two aspects: the demand side and supply side. The demand for energy is constantly increasing, which is mostly a good thing because it corresponds to economic and social development, but it also has some negative impacts, so we need to find ways to reduce these negative impacts.

On one hand, it actually starts from the supply side, which is why many countries are now advocating for renewable energy, making our energy supply cleaner and reducing negative impacts such as environmental pollution. On the other hand, on the demand side, consumers need to use energy intelligently without disrupting daily life.

The data centers and AI mentioned specifically in this question, although they require high energy consumption, have huge value, and they are helping our entire society to progress. For example, we can now do so many things conveniently on our mobile phones, which requires strong computing power and the use of many data centers behind the scenes to support this vast computing need. Smart phones have changed the lives of almost everyone in the past decade or so. They have created many new job opportunities and have helped many people in poorer countries who could not afford a computer before to conveniently obtain more information—even to take online classes to get a good education. Data centers have helped to improve the popularity of education, help eliminate poverty, and inequality.

I’d go a bit further. In fact, the supply and demand of energy in various places is usually unbalanced. For example, in Shanghai, the demand on electricity is generally greater than the supply, so Shanghai needs to buy electricity from other places. In the northwest region of China, which is also the largest base of new energy power generation in China, the local demand for electricity is insufficient, and the supply is far greater than the local demand. If the generated electricity cannot be used in time, most of it is wasted. So, in the northwest, if industries can create good economic and social value by consuming this energy, it is actually a win-win situation, which is also why several of China’s eight major data center bases are located in the northwest region of China. There are some very interesting models, such as the combination of solar power generation with desert management and the crop-breeding industry.

So, whether a thing is friendly or unfriendly to sustainability needs to be considered comprehensively based on the actual situation of a locality.

You also mentioned the data center electricity consumption issue. China is the world’s largest electricity user and generator. Whether it is from China’s data or the world’s data, the proportion of renewable energy generation has exceeded 30% in 2023, and it is expected that in 2024, the overall proportion in China and the world will exceed 35%. So, I think from the supply side, everyone is accelerating the greening of energy, and the speed of the increase in the proportion of renewable energy from the supply side will definitely be faster than the increase in the proportion of data centers in the total electricity consumption.

So, for me, rather than thinking about strategies to balance the negative impact of technological development on the world, I think more about how to adapt measures to local conditions, apply technology well in different places, and achieve the overall goal of sustainable development for the local area, and ultimately create a better life for local people.

what kind of impact have completed projects had on the cities and areas where you have invested? are there any learnings you can share with us?

The companies we’ve invested in mainly cater to clients in the Greater China area, including both enterprises and everyday consumers. They offer a pretty diverse range of products and services. For example, they’ve got projects monitoring and optimizing water distribution in real-time, which are in use in Beijing and Shenzhen. There are also energy-saving projects, which range from a single building to an entire industrial park. On the safety front, they use data analysis to prevent crime. There are services that care for the elderly, making it easy for them to access community services from home, while also helping government departments prevent accidents for elderly living alone by analyzing utility data.

Talking about the lessons learned, I think the most crucial point—and what I mentioned earlier—is having a viable economic model. Whether it’s government-initiated or market-driven, if you want to keep things going, you’ve got to figure out how to keep the investment flowing, which doesn’t mean it has to have a clear deadline to be profitable. If a company can’t find a sustainable economic model, there’s no way to talk about its commitment to sustainable development.