China is starting to adopt policies of proven effectiveness to help overcome these barriers and accelerate the commercialization of renewable energy technologies. Adopted in 2005, China’s first Renewable Energy Law (RE Law) has fueled the development and adoption of these policies: the RE Law led to the establishment, for example, of a feed-in tariff for renewable power, which requires utilities to purchase all renewable power generated at attractive fixed rates, and mechanisms for allocating the incremental costs of renewable energy nationwide, preventing incremental costs from being borne exclusively by consumers adjacent to renewable energy generation facilities. In addition, the RE Law led to the development of legally binding national renewable energy development targets that are among the most aggressive in the world. Now grantees are working to help build China’s capacity to implement these policies.

China’s projected wind development and subsequent decrease in cost as a result of the new Renewable Energy Law.

Source: National Development and Reform Commission, Medium and Long-Term Renewable Energy Development Plan (draft)