Ge Hansi's China Opportunity to Target Waste-to-Energy, Solar, and Wind Power

After being questioned by reporters about many issues, Mike Kinski asked back, "We use muck to produce methane and then use methane to generate electricity, but different types of waste produce different levels of methane. What type of garbage do you know? Is it best for power generation?"

"plastic?"

"No, the effect of plastic is very poor."

"Organic."

"It will soon produce methane, but it will run out soon."

"The best is paper. It is a very stable power generation material." Yan Shijie revealed the answer. As the managing director of Terra Firma, such a problem seems to him to be a piece of cake.

In fact, Taifeng Capital, which ranks among the top four industries in Europe, is the world's largest investor in the new energy sector. It has been ranked top 3 in the industry for three years in a row. The achievements are related to his founder's investment strategy of Guy Hands.

“Terra Firma means solid ground,” said Ge Kunsi. “So we generally invest in capital-intensive necessities. New energy is obviously a good investment option.”

Ge Hansi is called "Buffett in Europe" and "the first person in European industry" by many mainstream media in the world. However, despite such a halo, Ge Kunsi does not dare to take the slightest ground in the highly competitive market.

It is enough to prove that this giant European PE company, which manages more than US$40 billion in assets, announced in August last year that it has entered the Chinese market on a large scale, and that no real new energy large-scale projects have yet been invested.

However, Ge Kunsi and Taifeng have paved the way for entering China. “We have already found a partner and will invest with them in China.” Ge Hansi said, “The specific form of cooperation is not yet determined, but new energy sources will still choose industries that Taifeng is familiar with, such as waste-to-energy, solar and wind power. ."

New energy projects cooperate with large enterprises

Domestic enterprises have more thorough research on the Chinese market.

"21st Century": What is Taifeng Capital's investment plan in China in the future?

Ge Hansi: At present, the two tyrants that Taifeng Capital is investing in are Typhoon III and Taifeng Germany. Both of these two are investing only in the European market. At the same time, these two investments are also Still require controlling position.

However, it should be emphasized that, in the following period, Taifeng Capital's investment in China is not completed by any current **, but it will be completed by a company controlled by Taifeng Capital, and the specific single investment scale will be determined by In the opportunity itself.

The investment model of these companies controlled by Taifeng Capital in China is that the companies controlled by us are investing in China. For example, the aircraft leasing companies we invest in have approximately 1 billion yuan of aircraft-related investment in China. At the same time, our holding companies in the new energy and agriculture industries are also looking at projects. The scale of these projects can range from 50 million to several billion.

"21st Century": As a foreign investment company is relatively late to enter China, what do you think is the advantage in China?

Ge Hansi: Our team in China now has six people. Our advantage is that our holding company, Taifeng Capital, can deploy their people. Our holding company has 2-3 individuals working in the Chinese market, so we actually have 30 people doing business in China. Compared with other PE companies, we have a larger scale.

We started to pay attention to the Chinese market in 2006, but we did not invest in China. This is our conscious decision. At that time, we have three things to do: one is to raise funds for investing in China; the other is to build an investment platform in China; and thirdly, to invest in domestic companies through our subsidiary companies on our familiar platform.

"21st Century": Taifeng in the past have invested in the holding of investment in the company, is currently looking for a partner in China, but in the future will also ask Taifeng Holdings?

Ge Hansi: We are investing in new energy projects in China. We mainly choose to cooperate with large companies. One of the reasons is our experience in overseas mergers and acquisitions. Second, China is one of the largest markets for new energy industry, and domestic companies are in the Chinese market. The research is more thorough and the market's development is also very strong. Third, in terms of the entire operation, we have a relatively strong ability to operate overseas resources. Our domestic companies have a better understanding of the country’s national conditions.

From these three perspectives, our cooperation with domestic companies is in line with the reality of both parties. However, the specific cooperation model and equity ratio will depend on the specific project.

European debt crisis caused a decline in the rate of return

The return on investment of European projects is generally over 30%. Last year, the returns were only 6% and 7%.

"21st Century": What is the impact of the European debt crisis on Taifeng?

Ge Hansi: We believe that the current stalemate is actually not a big impact on the global economy. However, if the euro breaks down, it will have a profound effect on the world economy, including the Chinese economy. However, I think the possibility of the disintegration of the euro is very small.

The European debt crisis has had some impact on our project, but we are still much better than the entire market. In the past, the return on investment of our European projects generally exceeded 30%. Last year, our return rate was only 6% or 7%. In fact, the entire European market fell 11% last year.

"21st Century": What do you expect from the Chinese market and how big is Taifeng's investment in China?

Ge Hansi: The amount of investment is still not very easy to say. We are currently conducting a regional pilot project for waste-to-energy in China, but we must also look at how this project works and decide how many garbage power stations will be built according to the needs of the Chinese market.

In China, we are interested in many fields, such as solar energy. One year ago, we had not yet entered the solar field, but we discovered the opportunity of photovoltaic power generation in Italy and acquired RTR in 2011. This is the largest solar energy company in Italy. Afterwards, Taifeng began to develop solar power and became the leading company in Italy for solar power generation. Also, for example, in the wind energy market, we are mainly in the United States. At the beginning there was only one wind power plant. There are currently three, and we will probably build two more wind farms this year.

Therefore, if there is a good market, we will also invest heavily.

"21st Century": Taifeng Capital is the largest investor in the field of new energy. How do you see China's new energy investment?

Ge Hansi: At present, Taifeng Capital sees partners in China and seeks cooperation opportunities in new energy. However, in terms of specific industrial choices, we are still inclined to Taifeng's familiar industry.

For example, we invest in INFINIS in Europe, which is Europe's largest waste generator operator. We are very willing to look for this opportunity in China.

Trade barriers or will be more serious

As the price of photovoltaics continues to decline, trade barriers may become more and more serious.

"21st Century": In 2011, China's development in this area is also very fast. Does Taifeng have any plans to purchase PV power plants in China, run its own operations or want to invest in the construction of some solar power plants?

Ge Hansi: We are optimistic about the development of the new energy industry, but at present in China we only do research on waste-to-energy.

We have not yet noticed what kind of development of solar energy is in China, but if it is investigated that the market of solar power in China is very good, we may also have investment.

“21st Century”: At present, the United States has proposed a “double counter” survey for photovoltaic cells and wind towers produced in China. What do you think?

Ge Hansi: I think that because the U.S. government will vote this year, the entire policy will not be particularly clear now. Once this year's election is over, there may be a clear policy on dumping. But in reality, there is no large photovoltaic industry in the United States. Our photovoltaic power plants are also mainly in Europe. But with such trade barriers, I think that as the PV prices continue to fall, it may become more and more serious.

"21st Century": Many people worry that Europe will follow the example of the United States to China's photovoltaic cell "double anti-" investigation.

Ge Hansi: From our current point of view, we do not see the trend of "double opposition" in Europe. The European government is not as strong as the U.S. government, and its own barriers to international trade are not so serious.

Solar power stations in Europe itself have grown tremendously, and users have more than the United States. In Europe, more attention is paid to reducing the cost of power generation.

"21st Century": A large part of Taifeng Capital's business is in aircraft leasing. The EU now imposes a carbon tax on the aviation industry. Will it affect your business?

Ge Hansi: In fact, because the demand for the entire aviation industry is growing rapidly, the extra tax will not affect the customer's demand. Now the airlines are talking about this, and we certainly don't want to have it, but this tax is still required to be paid by the consumer. Because the entire imbalance of supply and demand does not actually affect the taxation.

For example, the European route has an airport tax on the first class itself. This tax has actually been in the past four years, with a single ticket of 50 Euros, but now it has probably risen to 300 Euros. This is actually a very significant increase, but there is no demand for demand. With any impact, the demand remains large and does not directly affect these airlines.