This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Chinese Hydropower: Investing Idea Or Industrial Complex?

Stocks in this article: CHC HNP MY PTR

James Dennin, Kapitall: China loves dams, perhaps a bit too much. We examined Chinese hydropower and the Hydro-Industrial Complex.

Say what you will about China's record on governance, human rights, or the environment. You cannot fault them for not trying to think ahead. 

Maybe it's just that my own country seems about as forward-thinking as a drunken frat boy – I'm already anticipating the next unproductive government battle over Obamacare in about two months - but some of the ways in which China's officials plan ahead is astounding to me. For instance, take what many critics refer to as China's Hydro-Industrial Complex. 

Read more on China from Kapitall: Chinese Housing Bubble: Will These Stocks Survive if it Bursts

The only time that China's legislature has ever squared off against party leadership was in 1993, over the Three Gorges Project. The most powerful dam in the world makes the our own Hoover Dam look like a hamster wheel – it generates ten times as much power. And the Three Gorges dam will soon be surpassed by another even larger Chinese hydroelectric project, whose plans were announced this May.

China is obsessed with hydropower, ironically, because they are concerned about the environmental impact of all that coal and oil they're burning. 

Now, it shouldn't be too hard to see why building too many dams also isn't good for the environment. When you dam up rivers, you disrupt the ecosystem, displace communities of residents, and flood huge swaths of land with sometimes polluted water.

However, electricity generated from hydropower release far fewer emissions into the air – and China actually leads the world in renewable energy investment. Much of that money goes into hydropower.

But the fervor for hydropower can sometimes goes beyond reason. For instance, the situation received renewed attention when The Economist investigated plans for a new dam just upriver of the Three Gorges which would utterly eradicate one of China's most fertile regions for farmers.

People need electricity and heat – but they also need food. The new dam, which wouldn't even generate that much electricity in the first place, drew attention to the fact that China's lust for more hydropower sometimes clashes against sound logic. Some of China's leaders are trying to push the country in a different direction, energy-wise. But it remains to be seen whether the trend will take hold. 

Right now China's long-term plan is for about 15% of its energy to come from renewable sources by 2020. The way forward seems to be hydropower, and China is building more dams, faster than anyone else.

1 of 2

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 18,053.71 +23.50 0.13%
S&P 500 2,088.77 +6.89 0.33%
NASDAQ 4,806.8590 +33.3870 0.70%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs