Maybe they should push into rural part of china, where hydra power can be cheaper.
Not only this, but well connected people willing to share some of the income or hashrate with their "friends" are known to get much better deals.
In China even "no cost" deals are not unheard of (i.e. they run a few MW of hardware in the unused electricity portion of "private" power generators, often in remote areas).
There have been mining operations apparently piggybacking on this "free" electricity as well, they run tons of Antminer S7s for "free," but some do get busted. I saw a story about this online but I forgot where. It's true, some people will share hashrate with another person or factory and use their electricity at a reduced price. All this to make some money... Once Bitfury 16nm chips come out, antminer s7 prices will take a nosedive as people replace their old s7s and avalons for the newest thing. Watch out, and sell your miners early for you don't want to lose your investment!
If your electricity is free and your S7 has paid itself back a while ago, you don't mind keeping it running for a little longer, no matter there are 16nm or even 10nm chips around the corner. There are people running much older stuff than S7 in China.
If I am not wrong the failed IPO was run by Chinese people, but I am not sure if it bodes well on a public listed company to aim for these locations I mentioned or if it is easily accessible to foreigners in general.
In reality there are often a few layers of people between the paying party and the party providing the power. The better connected and longer in this "business", the less layers there are.