Hydroelectric industrialist John D. Kuhns (M.F.A. ’75) recounted his life’s work of revolutionizing energy business relations between the U.S. and China at International House Thursday evening.
The founder and CEO of China Hydroelectric Corp, Kuhns spoke about his recent novel, China Fortunes: A Tale of Business in the New World, which is loosely based on his 25-year experience as a financier and industrialist in China.
But Kuhns wasn’t always set on business. After playing football at Georgetown and having his dream of playing in the N.F.L. dashed by two cuts, he was without a plan after graduation.
His advisor submitted his sculpture portfolio to the M.F.A. program at the U of C without his knowledge, and he was accepted for sculpture. “I came here because I had nothing better to do,” Kuhns said. “But though it was a fantastic time, I was no Picasso. I knew I had to find something else to do with my life.”
Kuhns went on to get an M.B.A. from Harvard and worked on Wall Street before starting his first company. Kuhns emphasized the importance of his creative experience in the business environment. “I’ve found that success always demands creativity,” Kuhns said.
Kuhns spoke about his background in the Chinese hydroelectric power industry and led his five companies to successful Initial Public Offerings (IPOs). He started his first company, Catalyst Energy, in 1981 around the time Congress was starting to deregulate electricity and allow Independent Power Producer (IPPs) to compete in the electricity market with contracted plants.
“After that first success, I was still young, and all I had to do was do it again,” Kuhns said. In 1988, he founded New World Power Corp., the first wind power company to go public. He continued this business model, but soon left the U.S. market for China.
Kuhns looked to China as a growth opportunity when the Chinese began to open the electricity market up to IPPs, just as the U.S. market had done a decade earlier.
Giving advice on doing business in China, Kuhns said to “sell what the government is buying,” namely electricity, and “be guided by fate,” noting that his company logo, the Chinese character for water, also looks like “JK,” Kuhns’s initials. “That’s when I knew luck was on my side,” Kuhns said.
“In the power industry, as with most commodities, success is about minimizing costs,” he said. “At first, I was the only one using Chinese manufactured technology, which was far cheaper than anything else,” he said.
Kuhns was able to sell electricity from his plants to the Chinese grid for about the same price as electricity in the U.S., but his costs were one third as high. His current business, China Hydroelectric Corp. raised nearly $100 million in its IPO and is now the largest foreign-owned player in China’s hydroelectric power market.
When asked by an audience member why he chose to write a work of fiction, Kuhns responded, “Look, there are thousands of nonfiction books on business in China. I thought, ‘Why should I do that?’” Laughing, he continued, “It’s all true to my story except for the girlfriends. My editor told me the book needed sex appeal.”
Among audience members were a group of visiting students from Beijing, a result of the University’s long foothold in China and the formal establishment of the Center in Beijing in 2010. The talk was sponsored by the Division of the Humanities.
