6. Case Study: Shenzhen
6.3. Shenzhen’s Smart City
Shenzhen has become one of China's technological and economic powerhouses (Große-Bley
& Kostka, 2021), even surpassing Hong Kong's GDP (Shenzhen Gov., 2022a); (Yim, 2022). It is also regarded as the Chinese Silicon Valley, where big domestic tech giants (Tencent, ZTE, Huawei, and Foxconn) have emerged (Cheng, 2021). Shenzhen also hosts many critical
manufacturing facilities that produce essential components for tech products. In fact, it is reported that 90% of the world's electronics come from Shenzhen (Harris, 2017), which makes the city extremely productive as well ecologically unsustainable. More importantly, even though China has enforced many smart city projects throughout the country, the overall performances are poor and only Shenzhen reached a 'good grade' out of 44 smart cities, beating in smartness even Shanghai and Beijing, according to a study (Shen, et al., 2018, pp. 675-677).
Thus, Shenzhen may provide a perfect case study to examine whether smart city building in China leads to ecologically more sustainable cities. If Shenzhen's smart city projects are not reaching a satisfactory outcome regarding sustainability, the other cities in China are likely to perform much worse.
Shenzhen's first smart city strategy was introduced in 2011 in the 'Outline Plan for Smart Shenzhen (2011-2020)', a 9-year-old development framework resembling other municipal4, regional5 and national6 plans, showing the central government's enormous influence and the top-down nature on the initiatives. The plan clarifies that the city wants to leverage the new technologies like IoT, data mining, and mobile internet, which can create possibilities for comprehensively improving the quality of urban economic life (Shenzhen Gov., 2013). It was expected to stimulate economic progress and establish a long-term competitive advantage for the city. The plan highlights that through technological innovation and smart urban management, the city sets a strong tech industry at the high end of the value chain and establishes the 'Smart Shenzhen' brand, that should be widely associated with a high-tech industrial-economic cluster. It can be witnessed in the program, that the main objective of the
"Smart Shenzhen" is to provide a solid technical guarantee for the transformation of the urban management model, which enables the improvement of monitoring, analysis, early warning, and decision-making capabilities. Additionally, the strategy pledged to provide a more sustainable living and working environment as well as to create a better climate for enterprises (Ng, et al., 2022); (Shenzhen Gov., 2013). Figure 9. summarizes the key projects that the plan introduced. As it can be seen, it attempts to execute an expansive range of urban programs, from making Shenzhen’s urban management more resilient and effective (3;4;5;7) to improving the people's capabilities and opportunities via smart health and education programs (8;6).
4 Shenzhen National Innovative City Master Plan; Twelfth Five-Year Plan for Shenzhen's National Economic and Social Development
5 Pearl River Delta Region Reform and Development Planning Outline (2008-2020)
6 National Informatization Development Strategy (2006-2020)
Figure 9.: Key Projects of the ‘Outline Plan for Smart Shenzhen (2011-2020)’
Key Projects Smart Dimension Goals (1.) Smart
Community
Smart Living
Integrate parking, access control, elevator management, health management, smart home, commercial consumption, and other systems and functions in communities (11.)
(2.) One-stop Smart Portal Project
Smart Living/
Smart Governance
Citizens can access relevant governmental services and data
(3.) Smart Municipal Process
Smart Governance Online monitoring system for municipal facilities to improve safety
(4.) Smart Integrity Project
Smart Governance Integrate different government departments: cross-industry information sharing, improve the database system
(5.) Smart Traffic Process Smart Governance/
Smart Mobility
traffic monitoring system to traffic operation efficiency.
(6.) Smart Medical Process
Smart People/
Smart Living • Establish electronic medical records.
• Build hospital health information network platforms.
• Promote telemedicine and personal medical services.
• Improve disease prevention and medical research, the level of medical services.
(7.) Smart Environmental Smart Governance Establish and improve early warning and monitoring systems for meteorology, urban droughts, floods and fires, water resources, water ecology, air quality, radio electromagnetic environment, marine ecology, etc
(8.) Smart Education Project
Smart People • Create smart campus, online interactive teaching platforms, online virtual laboratory,
• Make available of high-quality educational resources.
• Provide intelligent public education services, and promote the personal growth of students and lifelong education of citizens
(9.) Smart Grid Smart Environment • Build a variety of renewable energy application platforms.
• Promote the application of smart meters, smart appliances, electric vehicles, energy storage power stations, etc.
Regarding ecological sustainability, only the 'Smart Grid project' (9.) can be considered an incentive that focuses on environmental solutions and reduces GHG emissions. Especially smart mobility had a catalyzation in Shenzhen because the practical approaches established a mature EV charging infrastructure with many public charging stations that can supply the growing consumer demand in the city. Over the years, Shenzhen reached a promising electronic vehicle charging density (11/km2) that is one of the highest7 nationwide (Hove, et al., 2021).
7 Shanghai leads with 14/km2
Moreover, as the Figure 10. Shows below, Shenzhen is world-leading in terms of population per charger (Lutsey, et al., 2018), only slightly behind Oslo, making the city a global electronic vehicle hot spot (REN21, 2021).
Although private cars still dominate as the primary transportation source in the city, electronic public transportation8 accounted for 20% of the total transport share in 2018, only 2% behind private cars (World Bank, 2021). In addition, Shenzhen accomplished to create the world's first and largest all-electric bus fleet by 2017 (Keegan, 2018). It also achieved that nearly all taxis in the city are electric – 99% of the taxis were EVs in 2019. Moreover, it is estimated that online ride-hailing vehicles and urban-logistic vehicles will be all EVs by 2020 (World Bank, 2021); (Li, et al., 2020). Yet, it should be mentioned that the program started in 2009 as a national incentive, and Shenzhen was chosen as a pilot city.
Accordingly, it can be argued that despite the scientific debate9 about the overall lifecycle of EVs, Shenzhen has achieved green and smart mobility through national policies and smart city initiatives that contribute to a significantly less polluted (Shenzhen Daily, 2022), and environmentally more sustainable city. It is estimated that just the bus fleet that delivers 1.5 billion passenger trips in a year saves 345,000 metric tons of fossil fuel per year and reduces
8 Including metro, taxi, and bus
9 the overall lifecycle of EVs are still is under scientific debate with different assumptions concerning the energy intensity of manufacturing processes and lithium accumulators exertion
The Figure was created by Mario Vladar based on the data acquired from Lutsey, Nicholas & Hall, Dale
& Cui, Hongyang. (2018). Electric vehicle capitals: Accelerating the global transition to electric drive.
Figure 10.: Public EV Chargers per Million People in Leading Global Hotspots
1.35 million tons of CO2 annually (Yang, et al., 2018); (World Bank, 2021). To put it in perspective, 1.35 million tons of CO2 is equivalent to 67.5 million10 trees' carbon capture work per year (Climate Netural Group, sd).
In 2018, Shenzhen presented a new overarching policy (The New-Type Smart City Construction Comprehensive Plan) in which the municipality updated its plan based on the CCP's national agenda (19th National Congress of the Communist Party) to build a smart society and digital China (Shenzhen Gov., 2018); (Große-Bley & Kostka, 2021). It aims to follow the transformation of Shenzhen to construct an international, innovative, and modern city that focuses on improving people's lives and urban government capabilities and public services that foster the city's innovation capabilities for the private sector (Ng, et al., 2022);
(Shenzhen Gov., 2018).
The new strategy proposed six concrete construction goals ("six One") that the government needs to focus on by 2020. The six projects are detailed in Figure 11, showing that the 2018 strategy was also dominated by smart governmental initiatives to deliver citizen-friendly government services that are quickly accessible. In addition, to enhance urban management by integrating different systems and using technology to improve decision-making. As it can be seen, none of the projects focus on a 'smart environment,' neglecting sustainable solutions such as energy efficiency and renewable energies. Furthermore, the executed strategies and the large-scale intelligent instruments (surveillance cameras with AI, IoT) that the city implements require a fast (5G) online infrastructure and data centers.
Consequently, the urban management system that the city has enforced increases electricity consumption significantly. For example, Shenzhen's 5G-related electricity consumption reached 272 million kWh in 2021 (Xinhua, 2022), accounting for approximately 0.24% of the city’s total electric consumption.
Figure 11.: The New-Type Smart City Construction Comprehensive Plan
The project Goals Smart
Dimensions
Improve ecological sustainability One Perception A network system that fully perceives urban
security, traffic, environment, and cyberspace, and better use information technology to perceive the social operation situation of physical space and virtual space.
Smart
Governance No
10 It is an estimate. It can vary on location and tree type according to the Climate Natural Group
The project Goals Smart Dimensions
Improve ecological sustainability One-stop travel An electronic public service system has been
established and users can use it with biometric identification or with special ID code, digital certificate.
Smart Mobility No
One-click to know the whole situation
Build a assistance system that helps the decision-making based on big data, information sharing and artificial intelligence. It can help to obtain the required data from various departments and systems in the city.
Smart
Governance No
Smart life in One Screen
The goal is to integrate various government services, enterprises, and various organizations to one platform. Citizens can easily and quickly obtain high-quality life services through mobile phones.
Smart Governance/
Smart Living
No
One-stop Innovation and Entrepreneurship
Open-source relevant data, support data exchange platforms that enhance economic vitality and entrepreneurship.
Smart Economy No
Integrated operation linkage
Integrate urban operation management systems that can predict and respond rapidly to improve public safety.
Smart
Governance No
Analyzing the data provided for electricity consumption in Shenzhen shows that the Smart Shenzhen project did not have any impact on reducing the overall energy consumption in the city, which has been growing rapidly since its first implementation (2011). As the Figure 12. shows below the energy consumption increased by 62,5% from 2011 to 2021. In contrast, the share of renewable energies increased by only 43,3% from 2011 to 2021, which means that the energy consumption's increase rate is 19,2% faster than the rate of renewable energy advancement. Moreover, if we compare the results with the 2001-2010 period, it can be seen that consumption increases were only 30%, which is 13,3% less than in the 2011-2021 period, providing the evidence that the Shenzhen’s smart city development was ineffectual concerning energy reduction. It perhaps even increased the energy consumption. However, the overall energy consumption enlargement is probably due to the city's growing economic productivity.
Based on Shenzhen's GDP data, the annual compound growth rate was found to be 16% from 2000 to 2010 and 12% from 2010 to 2019, which was a $515,7 billion worth gain in the gross output value of all industry sectors between 2000 and 2019 (To, et al., 2021, pp. 6-8).
Figure 12. also indicates a well-marked advancement in renewable energies in Shenzhen, especially from 2001 to 2011. However, the acceleration is due to the Chinese government's significant efforts to shift to non-fossil fuel energy sources, which was first issued in 2005 by the government in the Renewable Energy Law, setting renewable energy generation as a principal national priority (Peidong, et al., 2009); (Zeng, et al., 2013).
6.3.1. Integrating the Great Bay Area
Concerning China's general urban development agenda (discussed in 6.1), the Pearl River Delta city cluster - also referred to as Great Bay Area – is a crucial strategic point for the central government. Therefore, Shenzhen's smart city plan also underlines the importance of opening-up cooperation and strengthening linkages with Hong Kong and the other parts of the bay area (Shenzhen Gov., 2018); (Shenzhen Gov., 2021); (Shenzhen Gov., 2022b). These efforts can be understood as a major national strategic move to integrate Mainland China and Hong Kong (special status) and slowly cease the ‘one country, two systems.’ The Smart Shenzhen plans were correspondingly issued to create unified standards for smart applications between Hong
The Figure was created by Mario Vladar based on the data acquired from: Kennedy C., et al. (2015)
‘Energy and material flows of megacities’ for the data of 2001 and 2011; the data for was acquired for 2021 from the China Southern Power Grid and form the Chinese Government (2022).
Figure 12.: Shenzhen Energy Consumption in Every 10th year from 2001 to 2021
Kong and the other surrounding cities in the Pearl River Delta to help the collaboration and data exchange (Shenzhen Gov., 2013).
The strategic plan which aims to accelerate the region's integration includes the establishment of the Qianhai Shenzhen-Hong Kong Modern Service Industry Cooperation Zone in 2010, located next to Hong Kong on Shenzhen's west coast. With the Qianhai economic zone, the goal is to promote economic and social development and the synergies between the region's cities. Since 2010, the economic site has expanded significantly and is home to many vital industries identified to drive economic prosperity, including finance, modern logistics, information services, technology services, and other professional services (Brooke, 2021).
Besides being a modern service industry, Qianhai seeks to leverage Hong Kong's economic liberalization measures. Specifically, it promotes close ties with Hong-Kong based financial centers and commercial hubs longing to attract international companies, professionals, and new business models that add high value to Mainland China (Legislative Council of Hong Kong, 2022). In other words, Qianhai bridges the gap between Hong Kong's rich professional services and the Chinese Mainland’s business domain, which has already led more than 11,500 Hong Kong-financed companies to be licensed to operate in the economic zone, with a total capital reaching almost 1.3 trillion yuan ($195 billion) (Zeng & Hua, 2021).
In the area, the municipality and tech companies such as Tencent also introduced smart city initiatives that pledged to develop ecologically intelligent neighborhoods (Authority of Qianhai, 2016). One project is a 2 square kilometer sized (the size of Monaco) new Tencent campus that will accommodate offices for 80,000–100,000 employees and homes for 19,000 residents with a green environment that is promised to be an exemplary smart city district (MVRDV, 2019); (Harrouk, 2020). The expensive $5.7 billion project, called Net-City, is designed to put people first by creating green corridors that support sustainable transportation and living (NBBJ, sd) (Liu, 2021). Moreover, the smart neighborhood is being developed more environment consciously than other similar developments in the past. For example, properties are designed to maximize shade and minimize energy use, as well the building's sizes will be lowered to require less material and energy use (Putzier, 2020).
6.3.2. The Influence of the Private Sector
In general, numerous private actors in China, specifically tech giants, influenced Chinese smart city projects. However, the bottom-up approaches were rapidly overtaken by top-down programs from municipalities and the central government (Atha, et al., 2020).
In Shenzhen, Huawei was one of the technology companies that entered the Smart City field early with various strategic collaborations. The company provides the core of the technical tools (5G and IoTs) and develops smart operation systems (brain) that run the technological infrastructure and the surveillance system in Shenzhen, financed by the municipality to deliver effective services for citizens (Yang, 2020). For example, in Shenzhen's airport, Huawei upgraded the airport infrastructure with smart tools that reduced 15% the waiting queues and 20% onboarding times. Also, Huawei's Traffic Lights and Traffic Control systems helped optimize traffic patterns (Rosas, 2021).
The company's ties with the CCP are somewhat blurred, raising squawking international concerns in the last few years (Corera, 2020). Although it’s declared a private company, the ownership structure is unspecified (Zhong, 2019), and Western critics argue that the government has considerable sway over China’s private companies. Estimating Huawei's actual relations with the CCP is probably unattainable; still, the $222 million government grant that the company received in 2018 nicely symbolizes its privileged status (Maizland &
Chatzky, 2020). In addition, the Chinese government's tech crackdown in 2021 left Huawei untouched while, for example, Alibaba was fined $2.8 billion with several other tech companies (Che & Goldkorn, 2021). On the other hand, the clash between the tech corporations and the Chinese government is more complicated than a company's internal links with the Communist Party. Some argue that Beijing sees the consumer internet companies such as Tencent and Alibaba as net-negative for technological advancement because their activity pulls out resources and talents from hard-tech fields like material science, semiconductor manufacturing, artificial intelligence, and biotechnology. Instead, China is endeavoring to direct its industrial mix toward what serves the nation in the view of the political elite (Wang, 2019); (Smith, 2021). Accordingly, Huawei fits perfectly in this formula, producing valuable assets for the government. Products that help preserve the political status quo and add value to the economy. Meanwhile, Tencent's online gaming platforms, described as "opium for the mind” (Ping, 2021), perhaps are not deemed valid for China’s strategic rationales.
It can be seen that social media and video game behemoth Tencent has a more hostile relationship with the government, which has challenged the company heavily with regulatory measures since 2021. However, as discussed above (6.3.1.), Tencent is still building an entire smart neighborhood. According to Sarah Moser, an associate professor of geography at McGill University, the intelligent campus in the Qianhai district can be considered a private property development that suits a broader international trend of technology companies getting involved
in the real-estate business. The project will be undertaken on an underutilized state-owned land at virtually no cost, subsidized by Tencent to decode the influx that emerged in Shenzhen's polluted city center by providing new offices and houses for the increasing number of Tencent employees (Thomala, 2022) in less contaminated areas (Putzier, 2020); (Kusisto, 2019). It is a win-win situation for everyone: residents and the municipality benefit because many people relocate to a new neighborhood leaving the city center less congested where the employees working conditions can improve, profiting from a more sustainable environment, while Tencent can yield gains with real estate investments.