Zhai Yongping, senior consultant for Tencent’s carbon neutrality strategy, has more than 40 years of experience in energy economics and investment. He has held senior positions at the African Development Bank and Asian Development Bank, where he helped countries establish viable power systems. In this edited interview, Zhai talks about the need to switch to renewable energy, how tech can overcome the challenges of making the switch, and how we can all make a difference in achieving carbon neutrality.

The following interview has been edited for length and clarity.

Q: How has investment in renewable energy changed?

A: From about 2000-2015, governments around the world introduced subsidies and policy incentives to invest in renewable energies such as solar (photovoltaic) and wind power. The big change is that wind and solar have become mainstream energy sources and can compete with fossil fuels in the market for commercial returns. They also attract private capital and bank loans, have their own business models, and have a high rate of return. 

We now have a new wave of low carbon, non-fossil energy technologies that require further development. Like wind and solar, emerging solutions, such as hydrogen, carbon storage and next-generation biomass tech also have the potential to become commercially viable. For these to succeed, we need to get in early with policy support, subsidies, and capital. 

Q: What is the energy triangle, and how can technology help solve the problem?

A: The first part of the triangle is providing stable energy supplies to develop economies and industries, and to improve people’s living standards. Second is to ensure that energy is affordable and accessible to all. Third is to make it sustainable. 

A zero-carbon goal could negatively impact the stability of energy supply and increase its cost. No country can do all three things at the same time, and there is a trade-off, with stable low-cost supply leading to high emissions. For example, in Europe, energy is more sustainable but the cost is high, while in Asia the cost is lower, but pollution is higher. 

Digital technology is key to solving the impossible energy triangle. I think we can grow economically, and improve people’s living standards at the same time, without the need to continuously increase emissions. 

Energy efficiency is the first part of the energy transition. The second is decarbonization, by replacing fossil fuels with renewable energy. The third is distributed systems. Instead of relying solely on a big power plant for energy, we can have our own source, such as rooftop solar panels. Technology is the common factor needed in all three parts.

Improved energy efficiency is our mantra, accompanied by technological progress. For example, relying on people to turn off the lights in order to save energy indoors is an inefficient process. Using artificial intelligence would be a far more efficient solution. This can be applied across businesses and industries. 

One challenge in replacing fossil fuels is introducing renewables in the system without losing inertia, and energy storage is needed to ensure a reliable power supply. The higher the proportion of renewable energy, the less inertia (of dispatching electricity). That said, these resources require less inertia, with power generated in the last few minutes, seconds or even milliseconds. Only technology can do this.

Finally, distributed energy can help save more energy, because our rooftop photovoltaics and energy storage are part of a bigger network, which means we need energy management systems to achieve their optimal operation. It allows us the flexibility to deploy more stored energy when the grid electricity prices are high, and use electricity from the grid when prices are low. 

Technology can solve the impossible energy triangle problem, making energy supply stable, affordable, clean and environmentally friendly.

Q: What role can Tencent play in ensuring access to affordable and clean energy for all? And what low-carbon technologies can it incubate? 

A: Tencent’s overall strategy is to support the development of the economy. It has three aspects. 

The first is rooted in the consumer internet and our ability to serve individuals and small and medium enterprises. Second is the industrial internet. We must cultivate industrial solutions and help industries digitalize. Third is promoting sustainable social value (SSV) by supporting the incubation of innovative technologies that help solve problems in the real world.

We call this the trinity of consumer, business, and society, or “CBS”.

The Tencent Cloud and Smart Industries Group has been supporting low-carbon technology initiatives. Our Tencent Research Institute conducts primary research, including on the use of hydrogen energy and Tencent’s Xplorer Prize provides young scientists with funds to make breakthroughs in research.

We have a carbon-neutral laboratory that backs institutions and universities in emerging tech research. We help incubate start-ups and within the scope of our carbon-neutrality lab, help the technology advance to pilot and application phase, and produce a business model.

If the incubation from the carbon laboratory is successful, Tencent can help expand the application of these technologies to commercial scale.

On the consumer side, our WeChat app contains programs that encourage the public to adopt low-carbon lifestyles. We have an educational game called Carbon Island, where players run an island where they must manage the challenges of the energy triangle. 

Q: You say that a low-carbon transition should put people first. How do you make this a reality?

A: I care deeply about this. I lived in Africa for seven years, and then in Southeast Asia, which is also relatively underdeveloped. A lot of developing countries are almost carbon neutral because there are still many people living in poor societies, and they have almost no energy. As their economies continue to grow, these countries have a unique opportunity to “decouple” prosperity from CO2 emissions and grow towards a low-carbon future.

If we accept that everyone should have enough energy to enjoy a decent living standard, we find that a large proportion of us are far above this level. We should target low-carbon lifestyles in this layer of people.  The onus for climate change mitigation is still largely on developed countries, which are the largest carbon emitters of the world today.

Q: What progress are you making?

A: Tencent’s comprehensive carbon strategy includes committing to its own carbon neutrality, as well as supporting industry, consumers, and society to reach carbon neutrality.

All of Tencent’s departments are involved. Our department has more than 60 projects, and some of our low-carbon technologies have begun to be used. For example, we invested in a company that does climate modeling, and uses AI to calculate the risk of natural disasters brought about by climate change.

Q: How do you view Tencent’s implementation of its carbon neutrality goal?

A: All low-carbon technologies, including wind, solar, geothermal, hydro, nuclear, hydrogen, carbon storage, biomass, marine energy, carbon sinks, energy efficiency improvement, and have a critical role to play.

Cooperation with industrial ecosystem partners is very important. There are technical solutions that Tencent can directly provide. We not only say that our own carbon synthesis should be realized, but we want to help our industry partners to achieve carbon neutrality together.

We are also exploring investments in renewable energy projects. In the field of carbon neutrality, we may face a low return, but there may be high risks. So should we still invest? Philosophically, from the broader capital sector, there should be new toolkits to support it.

Q: How do you contribute to carbon emission reduction in your personal life?

A: I have a very simple formula. I try to simplify my daily transport as much as possible. I walk more than 20,000 steps every day to commute. If I can take a bus, I will not take a taxi, and if I can ride a bicycle, I will not drive a car. It’s a hierarchy, walking and cycling first, then bus, then cars as the last resort, because of high emissions. 

Tencent’s founders said that their goal is to make the internet become a way of life, like water and electricity, for ordinary people. We can say that we also want carbon neutrality to become a way of life for people.