Case study 2: domestic solar power policy in China

Abstract

Growth in Chinese domestic solar power generation has surpassed all policy goals in the past ten years. This chapter examines the role of formal and informal institutions here, focusing on the tightly intertwined formal and informal solar PV institutions in the flexible setting of alternating strict and liberal government control. Whereas the main formal institution is the Renewable Energy Law, the informal institutions identified were found to affect issues related to actual implementation: problems with paying feed-in tariffs, access to the power grid (curtailment), and favouring of local coal-power producers (local protectionism). The chapter also examines the process after the unexpected reduction of government support on 31 May 2018, finding the dynamic between formal and informal institutions highly relevant, and perhaps even used as a way to manage a sustainable pathway for China’s solar industry.