Paying for soil remediation is difficult, and the cost of pollution control on farmland is even more considerable

“High pollution exceedance rate”, “a trillion-yuan-scale market”, “a complex systemic project”, “an emerging industry in its early stage of development” - China's soil pollution prevention and control is entering the United Nations' first “International Year of Soils” bearing these labels.

According to the National Soil Pollution Survey Bulletin released last year, the overall state of China's soil environment is not optimistic, with the national soil pollution exceedance rate reaching 16.1%. While soil environmental problems are prominent at abandoned industrial and mining sites, the environmental quality of cultivated land soil is even more worrying.

Faced with the severe situation of soil pollution, the pace of national legislation has clearly accelerated. In addition to adding soil remediation content to the new Environmental Protection Law, the Ministry of Environmental Protection recently published the new Soil Environmental Quality Standard (Draft for Comments), and the formulation and implementation of the Soil Pollution Prevention and Control Action Plan (abbreviated as the “Soil Ten Measures”) has also been put on the agenda.

With widespread soil pollution exceeding standards plus the push from national legislation, the industry expects a trillion-yuan-scale soil remediation market to emerge. However, many experts say that although the cake is large, one should not be blindly optimistic. Constrained by multiple barriers such as technology, funding and business models, it is unrealistic for the soil remediation industry to grow large in a short time.

Who pays for non-point source pollution

Compared with air pollution and water pollution prevention and control, soil pollution prevention and control, one of the environmental protection “three major battles”, can be described as “much thunder but little rain”.

Starting in 2013, the State Council launched pilot demonstrations of soil pollution treatment and remediation in Beijing, Shenzhen and other places, focusing on the surroundings of large and medium-sized cities, key areas for heavy metal pollution prevention and control, and the surroundings of centralized drinking water sources, but the pilot situation was not ideal.

According to preliminary statistics, the scale of soil pollution remediation pilots actually put on the market in 2013 was only about 5 billion yuan, and only 20 billion yuan in 2014. The market effect driven by the pilots fell far short of expectations.

This is not unrelated to the environmental protection industry basically relying on the government to pay. Jiang Jiandong, a professor at the College of Life Sciences of Nanjing Agricultural University, told reporters that most domestic soil remediation projects are concentrated on construction land in relatively good locations. The government is willing to pay to remediate some abandoned industrial sites into reserve land, and then carry out commercial development or residential construction.

In fact, as the curtain rises on soil remediation, the market space released by agricultural land is even larger. At present, the area of cultivated land awaiting remediation nationwide is about 390 million mu, and a conservative estimate puts the market space at about 700 billion yuan.

However, Jiang Jiandong said: “Remediation of cultivated land in China is more of a public welfare undertaking. Because cultivated land mostly involves non-point source pollution with low pollutant concentrations and large areas, remediation is difficult and costly, and few people are willing to fund or invest in remediation.”

In the view of Guo Fanli, research director of the Industry and Policy Research Center of CIC Consulting, nationwide remediation of cultivated land requires an investment of more than 10 trillion yuan. Once a nationwide soil remediation project is launched, the government will become the biggest payer.

However, for polluted farmland plots with no commercial value, many local governments are not very enthusiastic about funding remediation. Faced with enormous remediation funds, the government's fiscal capacity is also clearly insufficient.

Many experts told reporters that at present, domestic policies, regulations and business models for soil remediation are all rather unclear, and most enterprises focus on immediate interests and are unwilling to take risks. Due to the lack of funders, soil remediation for non-point source pollution such as pesticides and petroleum is very difficult to carry out.

Bioremediation cannot yet carry the load

Unlike water and air, soil is the final receptor of 90% of pollutants. For example, pollutant deposition caused by air pollution, irrigation and infiltration of sewage, and landfilling of solid waste all have soil as their “victim”. Faced with this complex treatment target, whether remediation technology is advanced and effective becomes the key to the success or failure of treatment.

Bioremediation is recognized as the soil remediation technology with the greatest potential. Jiang Jiandong said that compared with traditional physical and chemical methods, the biggest advantages of bioremediation are that it does not produce secondary pollution and has low cost.

For example, for heavy metal pollution in soil, hyperaccumulator plants such as Chinese brake fern (Pteris vittata) can be planted to absorb and remove heavy metals. This phytoremediation technology can convert some abandoned mines and mountainous areas that cannot produce grain into cultivated land.

In addition, microbial remediation is more feasible when addressing non-point source pollution. Jiang Jiandong said: “Through microorganisms and the active substances and enzymes they themselves produce, organic pollutants such as pesticides and petroleum that are difficult to treat in a centralized way can be degraded into non-toxic small-molecule compounds, or ultimately decomposed into carbon dioxide and water.”

However, Jiang Jiandong said that bioremediation abroad is already a very large industry, while domestically it is still very lagging behind, and there is still an extreme lack of professional soil bioremediation companies.

A person in charge at Hangzhou Dadi Environmental Protection Engineering Co. admitted frankly to reporters that although bioremediation is simple to operate and low in cost, it takes a long time to show results. Most enterprises, in order to meet deadlines, still adopt methods such as off-site landfilling and incineration, and bioremediation is rarely used unless there are special requirements.

Therefore, Jiang Jiandong believes that bioremediation technology should still work hard on remediation efficiency, for example by modifying or modifying key degrading enzymes to improve microbial remediation efficiency. In addition, for some new types of pollutants, more microbial resources must be obtained to meet soil remediation needs for different types of pollution.

Zhao Qiguo, an academician of the Chinese Academy of Sciences and a soil science expert, suggested that while strengthening technological research and development, the state should pay more attention to introducing, absorbing and digesting advanced foreign technologies suited to national conditions, so as to achieve comprehensive integrated innovation.

“Compared with more than 40 years of development in Europe and the United States, China's soil remediation industry is still an emerging industry, without a good foundation of accumulated experience and technological reserves. Forming an environmental remediation industry will still take a relatively long time.” Zhao Qiguo said.

Exploring a win-win model

Faced with this blue ocean of soil remediation, thousands of soil remediation companies have emerged in recent years, and the whole country has presented a scene of “wolves dancing in chaos”. In fact, most enterprises have merely increased their enthusiasm after seeing the potential market, and not many can truly strike gold.

In the view of Zhang Yi, president of the Shanghai Environmental Sanitation Engineering Design Institute, only soil remediation enterprises that simultaneously possess the three elements of “advanced applicable technology and complete sets of equipment”, “strong investment and financing capacity and engineering management capacity”, and “good government relations and internal mechanisms” are qualified to survive and grow bigger and stronger.

At the same time, with the introduction of the new Environmental Protection Law, many capitals are eager to move into soil remediation, but because the industry's current business model is relatively single, most capital is in a wait-and-see state.

In this regard, Zhang Yi suggested that the state should actively explore a win-win business model of government-enterprise cooperation, such as setting up special trust funds, so as to advance the development of China's soil remediation industry through the joint efforts of multiple parties.

Guo Fanli suggested that the government give up part of future benefits, so as to attract private investment, such as binding interests in development zone development, low-interest loans, or other benefits.

Reporters learned that a new business model of “remediation with capital” is emerging, such as enterprises and the government jointly carrying out projects, with part of the funds paid in cash and another part priced in land. After the treated land is built into an industrial park, the enterprise can act as the developer and recover another part of the profit when attracting investment.

However, because the cycle of this profit model is 10 to 15 years, there is relatively large time risk, so this model is still at the observation stage.