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Climate change and energy

These Chinese companies prove green tech can be profitable

Operating at considerable scales, BYD and GEM can show how to build profitable climate technologies in other countries.

October 11, 2023
a GEM battery and a BYD commercial electric truck

This story first appeared in China Report, MIT Technology Review’s newsletter about technology in China. Sign up to receive it in your inbox every Tuesday.

Living through the epic rainfall that flooded New York City a few weeks ago was nothing if not a reminder of just how urgently we need to tackle the climate crisis.

Fortunately, that was the focus of our ClimateTech summit last week, where my colleagues invited scholars, entrepreneurs, policymakers, and investors to the MIT campus to discuss the technologies that will be vital in combating climate change.

At the event, we also released a brand-new list that we have worked on for months: 15 Climate Tech Companies to Watch. These are the companies from all around the world that we think could have a significant impact on the future of our climate, either by enabling new energy sources like solar and nuclear, making electricity-powered products more versatile and efficient, or revamping the most ordinary goods in our lives, like food and cement. 

Among them are two Chinese companies you should know about. One is BYD, the world’s top electric-vehicle maker, which has just produced its 500 millionth EV! The other is GEM, which stands for Green Eco-Manufacture; it makes the supply chain for batteries more environmentally friendly by recycling the minerals in them.

For the list, I dug into these two companies—their histories, key products, and technological advantages, as well as the potential challenges they face. I’ll give you two quick previews in this newsletter, but I highly encourage you to go read more about them and the other 13 companies with the potential to change how we live.

🚗 BYD

What it does: BYD’s signature battery product—the Blade Battery—is cheaper, safer, and more durable than its peers. It’s so good that it powers both the carmaker’s own electric vehicles and Tesla’s. The company also stands apart because it handles or makes almost everything in the EV supply chain, from raw minerals to car chips. Its technological and manufacturing advantages make it one of the most competitive providers of EVs that are both reliable and, crucially, affordable. 

Why it’s important: The world needs a lot of different kinds of electrified transportation to replace the demand for fossil fuels, and BYD is making cars, buses, and even trains. The variety and affordability of its products makes transitioning to clean energy more feasible in many regions of the world.


♻️ GEM

What it does: Every day, tons of electronics and batteries are thrown away in China. GEM collects them and remakes them into new products or extracts the critical minerals from them to use again. A big part of its business in recent years has been recycling thousands of tons of EV batteries, which are either reused in less demanding scenarios like energy storage or crushed and turned into mineral powders that can be made into new batteries.

Why it’s important: EVs might be great for the climate, but their manufacturing process isn’t always. Particularly, the mining process for battery materials is often dangerous to both the environment and the workforce. As a result, efficient recycling of batteries will be vital to making the EV industry more climate friendly. 

As my colleague James Temple, our senior editor for energy, wrote in the introductory essay, our list offers a rare optimistic outlook on the future. It’s easy to feel that humanity is doomed when people talk about climate change, because it feels as if politics and inertia are getting in the way of problem solving. But it’s still important to talk about what the solutions could look like.

BYD and GEM in particular offer a peek at a future in which climate solutions are also profitable. BYD made $2.4 billion in profits last year, while GEM—which admittedly operates on a different scale—made $167 million in 2022, a jump of more than 60% from the year before.

This may provide inspiration for players outside China. If the Chinese EV market has proved that ordinary consumers can be genuinely interested in choosing electric cars over gas-powered ones, entrepreneurs and governments around the world know that they, too, can grow their own “BYD” or “GEM.” And that could draw more talent and investment into climate technologies.

Obviously, corporate solutions are only one part of the global climate change response, and on the list we made sure to spotlight the challenges each company faces. But I do feel that this list, which will be updated every year, provides a boost of confidence for people who want to see the world rise to the climate challenge. If that’s also what you need to keep moving forward on this Tuesday afternoon, come learn more about the other companies here.

Maybe this is too early, but do you want to nominate a company that you believe should be on this list next year? I’m all ears at zeyi@technologyreview.com.

Catch up with China

1. The Wagner Group bought two high-resolution observation satellites from a Chinese firm in 2022, allowing the Russian mercenaries to access surveillance images for its campaigns in Ukraine and Africa. (AFP)

2. In meetings with the Biden administration, American chip companies have pushed back on further chip restrictions, warning that they could derail plans to build new semiconductor factories in the US. (New York Times $)

3. Chinese chip manufacturer SMIC made $1.5 billion in revenue from American semiconductor-design companies in 2022—a fifth of its overall sales—despite being blacklisted by the US government. (Wall Street Journal $)

  • The US Commerce Department added 42 more Chinese companies to its export blacklist on Friday, saying they aided Russia in the war in Ukraine. (South China Morning Post $)

4. For Chinese EV startup Nio, selling one car means losing $35,000. But government backing allows companies like Nio to withstand such losses and keep growing. (New York Times $)

5. Chinese ultra-fast-fashion company Shein appointed a former SoftBank Group executive as its vice chairman. He’s tasked with diversifying the company's supply chain beyond China. (Wall Street Journal $)

6. A Hong Kong man was sentenced to four months in prison for importing “seditious” children’s books that portrayed the city’s democracy supporters as sheep defending their village from wolves. (The Straits Times)

Lost in translation

Since China softened its zero-covid policies almost a year ago, many Chinese companies that offer PCR test products have been forced to evolve. One company, however, has made the indecipherable decision to enter the market for precooked meals. 

According to the Chinese publication Lanjing Caijing, Shenzhen Nuclear Gene Technology, a company with more than 30 testing labs across China, was at the center of a controversy last year after it was repeatedly fined by local governments for fabricating test results and not adhering to technical standards. Then in May, the company incorporated a subsidiary called Wuhan Nuclear Agriculture Technology, which now works on producing frozen meals based on rice. 

The only connection between PCR tests and precooked meals is that both have been extremely trendy businesses. In recent years, the popularity of precooked food—often complicated, time-consuming dishes like grilled whole fish—has risen significantly in China among young people who don’t like to cook. The domestic market is around $58 billion now, and it’s predicted to grow to $148 billion by 2026. But people are also questioning whether it’s acceptable for restaurants to take a shortcut by turning to precooked food packages instead of developing their own recipes.

One more thing

A new study by Chinese researchers analyzed the relationship between a stock fund’s performance and the fund manager’s “facial attractiveness.” And yes, the paper actually includes a few examples of real manager faces that were given low scores by a deep-learning model for “facial beauty prediction.” Yikes. Oh, and their conclusion? “Funds with facial[ly] unattractive managers outperform funds with attractive managers by over 2% per annum.”

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Illustration by Rose Wong

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