Newly Nasdaq-listed SmartHeat inks China waste-heat deal

Shenyang, China-based SmartHeat (NCM: HEAT) said today it signed a $1.2 million equipment supply contract with Chinese utility Uda Heat Power for 16 plate-heat exchange units to be delivered by the end of this month.

SmartHeat, which was initially listed on Nasdaq Small Cap Market late last week, makes plate-heat exchangers and compact plate-heat exchanger units to help capture and recycle waste heat. The U.S. company predominately does business in China.

The deal with Uda Heat Power would bring the plates to Inner Mongolia, which is one of China's major coal production areas.

SmartHeat says the energy-saving equipment can significantly improve heat utilization rates, which could also reduce greenhouse gas emissions.

The deal came as part of the Chinese government's $586 billion economic stimulus plan, announced in November 2008 to pump $58 billion into infrastructure and energy efficiency projects (see China's stimulus package boosts water desal, recycling).

SmartHeat expects its technology to gain traction with local municipalities.

"This attests to the expansion of our markets beyond large cities—the new growth areas where SmartHeat is well positioned," CEO James Wang said in a news release.

SmartHeat says the market for heat-transfer technology in China is experiencing double-digit growth, currently estimated at about $2.4 billion.

The company said its current heat-transfer customers include Motorola, Veolia, Beijing International Airport, Sinopec and ACIC Air.