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What moves wind energy development in China? Show me the money!

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  • Lam, J.C.K.
  • Woo, C.K.
  • Kahrl, F.
  • Yu, W.K.

Abstract

China’s wind industry has grown rapidly over the past decade. Continued growth in this industry is critical for China’s domestic energy security and the global environment. However, little is known about the microeconomic drivers that move wind energy development in China. Based on a survey of experts in Mainland China and Hong Kong Special Administrative Region, this paper finds that the most important drivers of wind energy investment in China are perceived to be those that can have an immediate impact on a wind energy developer’s cash flow: government financial assistance, easy and inexpensive transmission access, wind energy cost decline, and a high feed-in-tariff. A renewable portfolio standard, tax incentives and international research and development cooperation are seen as less important. These findings underscore the importance of reducing the financial risk in wind energy development. However, none of the key drivers is directly tied to energy output, which suggests that China’s wind energy policies must be modified to incentivize energy output, rather than just installed capacity.

Suggested Citation

  • Lam, J.C.K. & Woo, C.K. & Kahrl, F. & Yu, W.K., 2013. "What moves wind energy development in China? Show me the money!," Applied Energy, Elsevier, vol. 105(C), pages 423-429.
    • Handle: RePEc:eee:appene:v:105:y:2013:i:c:p:423-429
    DOI: 10.1016/j.apenergy.2012.11.067
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