Albany		Northern Virginia
Atlanta		Orange County
Brussels	mckennalong.com	Rancho Santa Fe
Denver		San Diego
Los Angeles		San Francisco
Miami		Seoul
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Thomas Wardell		email address
404.527.4990		twardell@mckennalong.com

May 22, 2013

Via EDGAR

United States Securities and Exchange Commission

Division of Corporation Finance
100 F Street, NE
Washington, D.C. 20549-0405

Attn:	William H. Thompson, Accounting Branch Chief
	Tony Watson

Re: China Recycling Energy Corporation
Form 10-K for Fiscal Year Ended December 31, 2011
File No. 001-34625

Dear Mr. Thompson:

On behalf of our client, China Recycling Energy Corporation (“CREG” or the “Company” and sometimes referred to as “we” or “our”), and pursuant to our phone conferences on April 25, 2013 and May 13, 2013, this firm is filing a response to the SEC Comment Letters, dated December 14, 2012, January 23, 2013, February 7, 2013, March 4, 2013, March 20, 2013, March 28, 2013 and April 17, 2013, in connection with complying with the issues and outstanding disclosure items set forth therein. For convenience of reference, we have included in this response letter the same caption and paragraph number, as well as the text of the comment, set forth in your April 17, 2013 comment letter followed by our response. In addition, attached to this Response Letter are the following Excel spreadsheets: (i) a summary evidencing the effect of the restatements on our financial statements, (ii) analysis as of fiscal quarter ended June 30, 2010, (iii) analysis as of fiscal quarter ended September 30, 2010, (iv) analysis as of fiscal year ended December 31, 2010, (v) analysis as of fiscal quarter ended March 31, 2011, (vi) analysis as of fiscal quarter ended June 30, 2011, (vii) analysis as of fiscal quarter ended September 30, 2011 and (viii) analysis as of fiscal year ended December 31, 2011 (collectively, the "Restatement Spreadsheets").

Upon learning from you that the SEC has no further comment, the Company will promptly file: (i) Amendment No. 1 to the Company’s Form 10-K for fiscal year ended December 31, 2011 with the SEC (as attached to the Company’s Response Letter, filed January 30, 2013 and further revised as disclosed below) and (ii) with respect to the Shareholders' Equity comment below, Amendments to the Company's Form 10-Q reports for fiscal quarters ended March 31, 2011, June 30, 2011 and September 30, 2011.

United States Securities and Exchange Commission

May 22, 2013

Page 2

Form 10-K for Fiscal Year Ended December 31, 2011

Item 8. Financial Statements and Supplementary Data, page 50

Note 17: Shareholders’ Equity, page 78

Comment 1. We reviewed your response to the comment in our letter dated March 28, 2013. We do not believe the guidance in ASC 450 should be applied to subsequently measure the instrument you initially recorded using the guidance in ASC 480. As such, please revise your financial statements to subsequently measure the instrument in accordance with the measurement guidance in ASC 480-10-35.

Response:

Attached please find the aforementioned Restatement Spreadsheets, in Excel for 2010 and 2011, showing the impact on the financial statements of the issuance of the settlement shares to Mr. Dong pursuant to that certain PuCheng Biomass Asset Transfer Agreement in accordance with ASC 480-10-35.

As reflected in the Restatement Spreadsheets, the first gain is recognized in the quarter ending June 30, 2010 and the total gain recognized in 2010 is $2,809,884. The Restatement Spreadsheets also show the impact of the adjustment to the 2011 and 2010 annual and quarterly income statements and balance sheets. The Company proposes to reflect the recognition of the gain by amending only its 2011 periodic reports which will reflect the changes in the 2010 comparative periods as well. All three quarterly reports for 2011 would be amended as well as the 10-K for 2011. The Company believes that amending its reports in this way and including an explanatory note in the reports will be the best manner to communicate to, and appropriately inform, investors and the market.

I will confirm with you shortly whether our response is satisfactory, and, if so, we will file the amendments noted above. If, before that time, you have any further comments or require any further information or if any questions should arise in connection with this submission, please call me at (404) 527-4990 or Mr. Jay Shah at (404) 527-4593.

Very truly yours,

/s/ Thomas Wardell, Esq.

Thomas Wardell, Esq.

cc:	David Chong, CFO, China Recycling Energy Corp.
	Jeffrey Li, Esq.
	Jay V. Shah, Esq.

CREG

shares issued to Mr. Dong - restatements

Worksheet

	Stock price	3.63	3.75	3.13	3.05	2.69	2.02	1.2	1.2
	Balance sheet date, as of	6/29/2010	6/30/2010	9/30/2010	12/31/2010	3/31/2011	6/30/2011	9/30/2011	11/22/2011	12/31/2011
Balance sheet impact to liability - share to be issued	Original	11,780,471	11,780,471	11,780,471	11,780,471	11,780,471	11,780,471	11,780,471	-	-
	Restate - marked to market liability	11,780,471	11,029,410	9,205,881	8,970,587	7,911,763	5,941,176	3,529,411	-	-
	Difference	-	751,061	2,574,590	2,809,884	3,868,708	5,839,295	8,251,060	-	-

	For the period ending		Quarter ending Jun 30, 2010		Quarter ending Sept 30, 2010		Quarter ending Dec 31, 2010		for the year ending Dec 31, 2010		Quarter ending Mar 31, 2011		Quarter ending Jun 30, 2011		Quarter ending Sept 30, 2011		Quarter ending Dec 31, 2011			for the year endind Dec 31, 2011
P&L impact - gain on settlement of Dong's liability	Original	-		-		-		-		-		-		-		-		8,251,060			8,251,060
	Restate	-		751,061		1,823,529		235,294		2,809,884		1,058,823		1,970,588		2,411,764		-			5,441,176
	Difference	-		751,061		1,823,529		235,294		2,809,884		1,058,823		1,970,588		2,411,764		(8,251,060	)		(2,809,884	)

China Recyclying Energy

Restatement worksheet

As of June 30, 2010

Consolidated Balance Sheet	As previously reported		Net adjustment			Restated
Shares to be issued		11,780,471		(751,061	)		11,029,410
Retained earnings		7,393,961		751,061			8,145,022

For the six months ended June 30, 2010

Consolidated Statement of Operations and comprehensive income	As previously reported			Net adjustment		Restated
Changes in fair value of the liability		-			751,061		751,061
Total non-operating income (expense), net		(1,170,583	)		751,061		(419,522	)
Income before income tax		10,565,294			751,061		11,316,355
Income from operations		7,667,251			751,061		8,418,312
Net income attributable to China recycling Energy Corp		7,180,678			751,061		7,931,739
Basic net earnings per share		0.19			0.01		0.20
Diluted net earnings per share		0.15			0.01		0.16

For the six months ended June 30, 2010

Cash flows from Operating activities	As previously reported		Net adjustment			Restated
Net income		7,667,251		751,061			8,418,312
Adjustments to reconcile income including noncontrolling interest to net cash provided by (used in) operating activities:
Changes in fair value of the liability		-		(751,061	)		(751,061	)

China Recyclying Energy

Restatement worksheet

As of September 30, 2010

Consolidated Balance Sheet	As previously reported		Net adjustment			Restated
Shares to be issued		12,812,971		(2,574,590	)		10,238,381
Retained earnings		9,922,599		2,574,590			12,497,189

For the nine months ended September 30, 2010

Consolidated Statement of Operations and comprehensive income	As previously reported			Net adjustment		Restated
Changes in fair value of the liability		-			2,574,590		2,574,590
Total non-operating income (expense), net		(1,780,580	)		2,574,590		794,010
Income before income tax		15,067,783			2,574,590		17,642,373
Income from operations		10,817,221			2,574,590		13,391,811
Net income attributable to China recycling Energy Corp		10,227,402			2,574,590		12,801,992
Basic net earnings per share		0.26			0.07		0.33
Diluted net earnings per share		0.21			0.06		0.27

For the nine months ended September 30, 2010

Cash flows from Operating activities	As previously reported		Net adjustment			Restated
Net income		10,817,221		2,574,590			13,391,811
Adjustments to reconcile income including noncontrolling interest to net cash provided by (used in) operating activities:
Changes in fair value of the liability		-		(2,574,590	)		(2,574,590	)

China Recyclying Energy

Restatement worksheet

As of December 31, 2010

Consolidated Balance Sheet	As previously reported		Net adjustment			Restated
Shares to be issued		11,780,471		(2,809,884	)		8,970,587
Retained earnings		14,812,630		2,809,884			17,622,514

For the year ended December 31, 2010

Consolidated Statement of Operations and comprehensive income	As previously reported			Net adjustment		Restated
Changes in fair value of the liability		-			2,809,884		2,809,884
Total non-operating income (expense), net		(2,675,662	)		2,809,884		134,222
Income before income tax		24,692,109			2,809,884		27,501,993
Income from operations		17,826,069			2,809,884		20,635,953
Net income attributable to China recycling Energy Corp		16,032,597			2,809,884		18,842,481
Basic net earnings per share		0.39			0.06		0.45
Diluted net earnings per share		0.31			0.06		0.37

For the year ended December 31, 2010

Cash flows from Operating activities	As previously reported		Net adjustment			Restated
Net income		17,826,069		2,809,884			20,635,953
Adjustments to reconcile income including noncontrolling interest to net cash provided by (used in) operating activities:
Changes in fair value of the liability		-		(2,809,884	)		(2,809,884	)

China Recyclying Energy

Restatement worksheet

As of March 31, 2011

Consolidated Balance Sheet	As previously reported		Net adjustment			Restated
Shares to be issued		11,780,471		(3,868,708	)		7,911,763
Total Noncurrent liability		73,417,554		(3,868,708	)		69,548,846
Total liability		101,481,863		(3,868,708	)		97,613,155
Retained earnings		18,811,698		3,868,708			22,680,406

For the three months ended March 31, 2011

Consolidated Statement of Operations and comprehensive income	As previously reported		Net adjustment		Restated
Changes in fair value of the liability		-		1,058,823		1,058,823
Total non-operating income (expense), net		304		1,058,823		1,059,127
Income before income tax		6,478,035		1,058,823		7,536,858
Income before noncontrolling interest		5,082,105		1,058,823		6,140,928
Net income attributable to China recycling Energy Corp		4,562,967		1,058,823		5,621,790
Basic net earnings per share		0.12		0.02		0.14
Diluted net earnings per share		0.09		0.02		0.11

For the three months ended March 31, 2011      

Cash flows from Operating activities	As previously reported		Net adjustment			Restated
Net income		5,082,105		1,058,823			6,140,928
Adjustments to reconcile income including noncontrolling interest to net cash provided by (used in) operating activities:
Changes in fair value of the liability		-		(1,058,823	)		(1,058,823	)

China Recyclying Energy

Restatement worksheet

As of June 30, 2011

Consolidated Balance Sheet	As previously reported		Net adjustment			Restated
Shares to be issued		16,780,471		(5,839,296	)		10,941,175
Total Noncurrent liability		73,115,306		(5,839,296	)		67,276,010
Total liability		97,035,322		(5,839,296	)		91,196,026
Retained earnings		22,139,584		5,839,296			27,978,880

For the six months ended June 30, 2011

Consolidated Statement of Operations and comprehensive income	As previously reported		Net adjustment		Restated
Changes in fair value of the liability		-		3,029,411		3,029,411
Total non-operating income (expense), net		536,401		3,029,411		3,565,812
Income before income tax		11,120,897		3,029,411		14,150,308
Income before noncontrolling interest		8,941,266		3,029,411		11,970,677
Net income attributable to China recycling Energy Corp		8,257,968		3,029,411		11,287,379
Basic net earnings per share		0.20		0.08		0.28
Diluted net earnings per share		0.16		0.06		0.22

For the six months ended June 30, 2011

Cash flows from Operating activities	As previously reported		Net adjustment			Restated
Net income		8,941,266		3,029,411			11,970,677
Adjustments to reconcile income including noncontrolling interest to net cash provided by (used in) operating activities:
Changes in fair value of the liability		-		(3,029,411	)		(3,029,411	)

China Recyclying Energy

Restatement worksheet

As of September 30, 2011

Consolidated Balance Sheet	As previously reported		Net adjustment			Restated
Shares to be issued		11,780,471		(8,251,060	)		3,529,411
Total Noncurrent liability		72,767,729		(8,251,060	)		64,516,669
Total liability		107,727,016		(8,251,060	)		99,475,956
Retained earnings		30,173,358		8,251,060			38,424,418

For the nine months ended September 30, 2011

Consolidated Statement of Operations and comprehensive income	As previously reported		Net adjustment		Restated
Changes in fair value of the liability		-		5,441,176		5,441,176
Total non-operating income (expense), net		1,871,324		5,441,176		7,312,500
Income before income tax		22,053,728		5,441,176		27,494,904
Income before noncontrolling interest		17,684,471		5,441,176		23,125,647
Net income attributable to China recycling Energy Corp		16,913,200		5,441,176		22,354,376
Basic net earnings per share		0.41		0.13		0.54
Diluted net earnings per share		0.33		0.10		0.43

For the nine months ended September 30, 2011

Cash flows from Operating activities	As previously reported		Net adjustment			Restated
Net income		17,684,471		5,441,176			23,125,647
Adjustments to reconcile income including noncontrolling interest to net cash provided by (used in) operating activities:
Changes in fair value of the liability		-		(5,441,176	)		(5,441,176	)

China Recyclying Energy

Restatement worksheet

As of December 31, 2011

Consolidated Balance Sheet	As previously reported		Net adjustment		Restated
Shares to be issued		-		-		-
Retained earnings		34,414,271		-		34,414,271

For the year ended December 31, 2011

Consolidated Statement of Operations and comprehensive income	As previously reported		Net adjustment			Restated
Changes in fair value of the liability		8,251,060		(2,809,884	)		5,441,176
Total non-operating income (expense), net		989,032		(2,809,884	)		(1,820,852	)
Income before income tax		26,630,985		(2,809,884	)		23,821,101
Income before noncontrolling interest		22,398,040		(2,809,884	)		19,588,156
Net income attributable to China recycling Energy Corp		21,449,879		(2,809,884	)		18,639,995
Basic net earnings per share		0.51		(0.07	)		0.44
Diluted net earnings per share		0.39		(0.05	)		0.34

For the year ended December 31, 2011

Cash flows from Operating activities	As previously reported			Net adjustment			Restated
Net income		22,398,040			(2,809,884	)		19,588,156
Adjustments to reconcile income including noncontrolling interest to net cash provided by (used in) operating activities:
Changes in fair value of the liability		(8,251,060	)		2,809,884			(5,441,176	)