Market forces could be solution to collective public heating puzzle

By Liu Zhijun Source:Global Times Published: 2013-1-9 23:33:01

Amid the ravaging cold, collective public heating has become a hot topic in South China. There are various viewpoints from the perspectives of economic, environmental and social costs. However, some issues still deserve further discussion, such as the role of government and how society should share the costs.

There are different opinions over the nature of public heating - should it be a public service or a commercial service? Some believe that along with the enhancement of China's national strength and people's living standards, the necessity for collective public heating in southern Chinese cities is justified.

However, the expectation that the government will offer services that can be provided by the market is probably unrealistic, and some people have noticed the great business opportunities in providing public heating in southern China.

Whenever the Chinese public discusses collective public heating, there is often an implicit assumption that it should be provided by the government. However, if we believe public heating is related to the more advanced need of living comfort, rather than the basic need of survival, then it should be addressed through market solutions.

Whether we see it as a government responsibility or focus more on the market prospects, we should comprehensively look into the social costs and benefits. Some experts have already calculated and compared the costs of collective public heating and individual heating. We should take into consideration environmental costs in both instances.

With respect to benefits, we should not only look at potential space for profits, but also assess people's sense of happiness brought by public heating.

But this is easier said than done. China is a colossal country where different southern cities have different levels of economic growth, energy structures and house characteristics. The numbers of chilly days vary from region to region too. It's not an easy task to figure out the feasibility, pros and cons of public heating in southern Chinese cities.

From my perspective, different regions should have different solutions. In areas with higher levels of economic growth, public heating can be provided as a general public service. It can be operated by SOEs at a certain level of deficit.

In poorer regions, market players should be introduced to solve the problem. If public heating, as experts predict, has great business prospects, real estate developers will certainly consider the possibility of providing collective public heating in future residential communities. Enterprises and investors will also ponder the possibility of providing public heating to existing residential buildings.

As China's fiscal strength is still limited, improving infrastructure will remain a long-term process, and the wish for collective public heating in some regions of southern China can only be realized gradually.

The author is a professor of sociology at Zhejiang University. opinion@globaltimes.com.cn



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