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Read more about China in our special issue

SHI ZHENGRONG is an unlikely contender for the title of China’s richest man. He is a green entrepreneur in a nation that is home to 16 of the world’s 20 most polluted cities. Last year, Forbes magazine ranked him top of mainland China’s rich list, with a net worth of $2.2 billion. Only electrical retailer Wong Kwong Yu kept him from retaining the title in 2007.

Shi is head of Suntech Power, based in Wuxi, which is one of the largest producers of solar-cell modules in the world. He represents the kind of home-grown success story in both technology and business that will be needed in spades to meet the crushing energy demands of the emerging superpower.

China’s demand for energy is expected to nearly double by 2020, far surpassing the needs of any other country. The consequences for the global climate, and for the health of its own citizens, are stark. This year, according to the International Energy Agency in Paris, China’s carbon dioxide emissions will overtake those of the US, largely because of its overwhelming reliance on coal. That means more air pollution, which already causes more than half a million premature deaths in China every year, according to

In an effort to prevent disaster, the Chinese government’s current 50-year energy plan seeks to reduce coal use from 67 per cent of the nation’s total energy consumption in 2003 to 55 per cent in 2020, and 40 per cent in 2050 (see Chart). The difference would be met by a large increase in natural gas and renewable energy. Solar power is a major part of the plan and could drive down the use of coal further, if only it were not so expensive.

Bringing down those costs is where Shi could really make his mark. His journey to the top of the solar tree began in the 1980s. He felt prospects for a young physicist were slim in China, so he moved to Australia’s University of New South Wales (UNSW) in Sydney. After his fellowship ended he won a job at a university spin-off company called Pacific Solar, which was developing thin-film solar cells. There his group was among the first in the world to grow crystalline silicon on glass at a low temperature – a key advance in commercialising solar cells. Martin Green, Shi’s mentor at UNSW, is glowing about his ex-colleague. “Zhengrong was an excellent scientist – always able to make progress where others would have stalled,” he says.

By the late 1990s, however, Shi got itchy feet. “I felt a little bit bored of what I was doing, because there were no more challenges,” he says. He had been visiting China to lecture and was spending much of his time as a sort of solar guru to students, business people and government officials. “The country lacked a true expert,” he says.

A friend eventually persuaded him that China had become more supportive of entrepreneurs, so Shi decided to move his family back home. In 2001, with 11 patents in his pocket and a truckload of bravado, he approached Chinese investors for the money to set up a solar energy company. The regional government of Wuxi, an aspiring industrial hub near Shanghai, stumped up $6 million and helped bring in another $5 million in research grants. Winning such support would have been unlikely in Australia, Shi says, or in any country whose government does not invest directly in companies.

However, as Suntech grew, the official backing that had got the firm off the ground became a millstone around its neck. By 2004, the government’s political hand-wringing and lack of business expertise were holding the company back, says Shi. “They wanted to control the company. That was a very stressful time. I can tell you my blood pressure went up.” He was determined to cut the apron strings, and resolved to quit if the state presence stayed. “If you cannot run a company in the way you like, then there are endless politics, struggling. It can kill it.”

Facing down the local party bosses was a brave move, but it paid off. Wuxi’s government investors eventually backed away, selling their stake for a big pay-off after accepting that their meddling could discourage future entrepreneurs. Free of its ties, in December 2005 Suntech floated on the New York Stock Exchange, initially valued at more than $5 billion.

Today, Suntech is worth about $7 billion and does most of its business with countries that subsidise solar power, such as Germany and Spain. It has provided photovoltaic panels for large projects, ranging from the new roof on San Francisco airport’s third terminal to a 130-kilowatt system that will help power the Beijing National Stadium being built for the 2008 Olympics.

Unsurprisingly, Shi is bullish about China going solar to meet its escalating energy needs. “There’s no choice: China has to go renewable,” he says. Looking at the haze of air pollution outside Shi’s 63rd-floor office window in Shanghai, it is hard to disagree. Shi says the government is taking notice of wind and biomass as renewable energy sources, and solar farms attached to the grid will be next.

Not everyone is optimistic about the government’s plan to go green, however. “A plan is one thing, how you implement it is another,” says C. S. Kiang, a climate scientist and dean of the College of Environmental Sciences at Peking University.

There is good reason for his concern. In 2005, China’s National People’s Congress passed the Renewable Energy Promotion Law, which commits the country to producing 15 per cent of its power from clean energy sources by 2020. Despite this, the construction of coal power plants has continued unabated, with more than two major plants being added to the electric grid per week in 2006, says Eric Martinot, a visiting scholar at the Tsinghua-BP Clean Energy Research and Education Center in Beijing.

“The government is pushing renewable energy, yet two coal power plants are added to the grid each week”

The discrepancy between plan and action is due in part to conflicts of interest between local governments and Beijing’s central authority. This will be a major issue in future. “The central government cannot control local governments as much any more, because they now have their own money,” says Kiang.

That paves the way for companies such as Suntech to play a big role in China’s energy future. Martinot says it is likely the country will meet its renewable energy targets, but this will depend on industrial development and pricing levels. Because of its high cost, solar power will probably remain a small slice of the pie for a while: Suntech’s sales in China for 2007 are only 1.5 per cent of its total, but Shi expects that to increase as solar costs fall and energy demand soars.

Given the billionaire’s record, it is tempting to believe him. However, the greening of China will depend on others following in his footsteps. Many researchers have the right expertise, Shi says, but lack patience. “We need to be careful about short-sightedness. Chinese scientists are doing some good work, but the country has become so materialistic.”

Energy and Fuels – Learn more about the looming energy crisis in our comprehensive special report.