China’s energy policy is developed through a two-step approach. The central government first develops broad policy goals and communicates them every five years in its Five Year Plans. Ministries, agencies, and the National People’s Congress then use the plans to design targeted, specific policies. China’s 10th and 11th Five Year Plans (2000-2005, 2006-2010) were the first to include goals for renewable energy development.
China’s increased focus on renewable energy requires coordinated action from many entities and groups outside the central government and government agencies. In January 2010, the government announced the creation of the National Energy Commission (NEC) to streamline China’s energy operations and coordinate activities by the National Energy Bureau (NEB) and the National Energy Administration (NEA), which tend to overlap with the mandates of other ministries. The NEC will also assume many of the energy-focused activities of the National Development and Reform Commission (NDRC) and the Ministry of Finance. The goals of the NEC are to devise China’s energy strategy, ensure the country’s energy security, and coordinate cooperative programs.
One of China’s main goals in developing renewable energy has been to supply off-grid electricity to more than 2 million rural households that have no access to electricity. Another goal is to address concerns about the long-term environmental impacts of coal-fired electricity generation. China has acknowledged the potential impact of increased greenhouse gas (GHG) emissions on climate, and China has already taken several steps to reduce emissions of regionally important criteria air pollutants, such as particulates, sulfur dioxide, and nitrous oxide (NAE/NRC/CAS/CAE, 2007). Among other things, these reductions have served as a response to civil unrest in recent years to protest energy-related pollution. Even more important, however, China sees renewable energy as a potentially lucrative economic opportunity, particularly in the global market for clean technologies. In 2009, for example, more than 90 percent of photovoltaic (PV) cells produced in China were exported.
In China’s 11th Five Year Plan, its broad renewable energy policy goal is to “accelerate renewable technology advancement and industrial system development … specifically supporting the technology breakthrough and industrialization of bio-liquid fuel, wind power, biomass power, and solar power.” This goal is supported by a series of suggested measures and incentives, shown in Tables 5-1 and 5-2. Four important policies in defining China’s renewable energy landscape are: Renewable Energy Law of the People’s Republic of China, which outlines policy goals; Medium and Long-Term Development Plan for Renewable Energy