Case | HBS Case Collection | May 2002 (Revised August 2006)

Yangcheng: AES in China

by Richard H.K. Vietor

Abstract

AES, an American electric power company with 141 plants worldwide, is just completing construction of a 2,100-MW plant in China--the largest ever. The project, a joint venture with five local companies, has several environmental, ownership, and operational issues as construction is completed. The decision point is whether AES should explore issues of foreign direct investment as they pertain to the environment. Do U.S. MNCs run operations abroad at the same level of environmental efficacy as in their home country? If not, why not? And what are the local barriers and competitive reasons for not doing so?

Keywords: Energy Generation; Joint Ventures; Foreign Direct Investment; Environmental Sustainability; Problems and Challenges; Energy Industry; China;

Citation:

Vietor, Richard H.K. "Yangcheng: AES in China." Harvard Business School Case 702-006, May 2002. (Revised August 2006.)