International warming and carbon emissions have strongly shaped insurance policies all over the world in the course of the past decade. As we speak most governments all over the world see it as their aim to scale back greenhouse fuel emissions. When China surpassed the US in carbon emission in 2006 the country came into the spotlight of carbon and renewable power discussions with the country’s power consumption relying significantly on fossil fuels. Presently, China’s power provide is dominated by coal consumption, while pure fuel and oil are in relative brief provide. In 2007 fossil fuels accounted for greater than 90 % of China’s power consumption, of which roughly 75 % got here from coal.  That is largely the result of coal being China’s most ample fossil power useful resource with an estimated 5,570 billion tonnes in coal deposits situated inside the nation, making up roughly 12.6 % of the world’s complete coal reserves.  Despite its plentiful reserves China turned a internet importer of coal in 2009.
China also overtook america in 2009 to turn out to be the world’s largest power consumer and as a by-product additionally turned the chief in greenhouse fuel emissions. In 2011 China was estimated to emit more CO2 than the US and Canada together, a rise of 171 % because the yr 2000.
It is widely known that China has to play a key position in tackling worldwide greenhouse fuel emissions and international warming. Whereas China’s emissions are still growing quickly we observe that the US and European emissions have decreased throughout current years. However, China’s per capita emissions are still far decrease than that of its rivalling western counterparts. In 2006 China’s carbon dioxide emissions equalled to the worlds common and have been less than 25 % of American emissions. Figure 2 under exhibits the per capita power associated CO2 emissions in 2006.
While China’s per capita emissions do not yet rival that of its western counterparts, prospects for progress stay robust. Provided that China’s relatively low per capita consumption degree, it is expected that with the nation’s continued economic progress and urbanisation, the per capita emissions and complete emissions are nonetheless going to increase considerably. In accordance with the International Energy Company, China is predicted to contribute 36 % to the projected progress in international power use, with its demand rising by 75 % between 2008 and 2035. 
With growing power consumption China can also be more and more dealing with severe pollution issues. The coal dominated power consumption results in critical environmental air pollution in China. As proven in Fig. 2, between 1983 and 2005 the acid rain-polluted area has extended tremendously to about 1.5 million square kilometres in China. Over 10 % cities in 20 provinces have been affected by acid rain up to now.  Figure 3 on the next page exhibits the event of China’s acid rain profile in the course of the past three many years.
Along with the problem of increased CO2 manufacturing and pollution that China faces there’s also the difficulty of power safety. With China having transmitted from being a internet exporter to a internet importer of coal in 2007, power safety has turn into a prime priority for the Chinese government. Safety of power provide, growing power demand, the emission of greenhouse gases and air pollution has compelled the Chinese language authorities to turn to renewable power.
Dealing with these challenges China is nicely aware that vigorous government-led change is important, figuring out that the future of renewables “hinges critically on strong government support to make renewables cost-competitive with other energy sources and technologies, and to stimulate technological advances.” As one of the crucial proven forms of economically sustainable renewable power, wind energy has been embraced by Chinese policy makers. In contrast to typical power sources, wind power does not rely on fossil fuels as soon as assembled and China has been found to have ample wind assets with its giant land mass and expansive coastline. This essay will concentrate on China’s policies relating to wind power, preceded by a quick overview of China’s wind potential and followed by a discussion of policy points and common obstacles that China is dealing with with wind energy.
China Wind Potential
In accordance with the estimates by China Meteorological Administration, China’s onshore technically possible wind assets are estimated to be around 1000 GW with China’s offshore potential estimated to be roughly 300GW. To place this into perspective, China’s technically feasible wind assets equate to 1300 commonplace atomic energy crops with 1000MW output energy. Determine four under exhibits the wind density across China measured by the CMA Wind and Photo voltaic Energy Assets Assessment Centre.
It may be observed that the majority of China’s wind assets are ideally situated in areas with very low population aside from the coastal areas. China is nicely aware of the country’s wind energy potential. Wind power in China registered a report degree of enlargement just lately, and has doubled its complete capability every year since 2004. 
The wind business at present is turning into one of the world’s quickest growing power sectors, helping to fulfill international power calls for and offering the most effective alternative to unlock a brand new era of environmental protection and to start out the transition to a worldwide financial system based mostly on sustainable power. China with its giant wind potential and the issues confronted by its heavy reliance on fossil fuels has additionally closely invested into the wind power market. Figure 1 under exhibits the event of China’s installed wind capability in the course of the past 5 years.
In 2010 China’s complete energy capacity was estimated at 978.2GW with renewable wind power capability reaching 44.8GW. Chinas wind power capability thus makes up 4.5 % of its complete capacity and has now surpassed the US wind energy capacity. In the course of the 2005–2010 period, wind power grew 36-fold from over 1GW in 2005.
Wind Power associated Laws, Laws and Policies
China’s grid-connected wind energy may be traced again to the 1980s when the primary pilot wind farm was established in Rongchen Metropolis situated in East China’s Shandong Province. Nevertheless it was only in the 1990’s when insurance policies relating to wind power power emerged with the 8th 5 Yr plan the place wind power was particularly talked about for the primary time. The 8th Five Yr Plan was followed by a large amount of policies and legislation supporting wind power especially in the course of the past decade. An inventory of wind policies and laws relating to wind energy may be found under in Table 1. Discover that policies indirectly affecting the wind power sector akin to carbon credit score policies or carbon emission insurance policies for example haven’t been included.
Reflecting back on the growth of China’s wind capacity (Determine three), while investigating China’s legislation and policies in relation to the wind power sector, it turns into evident that the speedy progress of China’s wind power is strongly depending on government intervention.
In 1999 the National Improvement and Reform Commission released an official statement setting wind power pricing ‘at a level that would repay capital costs with interest plus a reasonable profit’ . This was adopted by a collection of presidency investments into the construction of wind farms together with the first particular goal by the 10th 5 yr plan of 1500kw of wind power capacity that was to be reached by 2005.
Power Concession Program (2003)
In 2003 the Wind Power Concession Program was carried out with the purpose to accumulate buyers for wind farms over 50MW via concession bidding. While at first the bidder who agreed to construct a wind farm with the lowest concession credit score this was later revised so that the electrical energy worth was given 40 % of the entire weight in deciding the profitable bids. Beneath the wind energy concession program the provincial grid company should signal an influence purchase agreement with the winners of the concession auctions. That is the primary time it emerged that grid power corporations are pressured to so and have become official regulation with the passing of the Renewable Energy Regulation in 2005.
Necessities of Local Content (2005)
The necessities of local content material regulation handed in 2005 elevated the share of elements that should be regionally sourced to be eligible for the wind concession program to 70 % up from an preliminary 50 %. The result of this was clearly noticeable with China now having three wind energy producers which might be competing with the world’s prime ten.
The Renewable Energy Regulation (2005)
On 28 February 2005, the Renewable Energy Regulation was passed in the 14th session of the 10th NPC Standing Committee. The Regulation of Renewable recognises the significance of renewable power improvement in China stating that: “In order to promote the development and utilisation of renewable energy, improve the energy structure, diversify energy supplies, safeguard energy security, protect the environment, and realise the sustainable development of the economy and society, this Law is hereby prepared” . The Renewable Energy Regulation put ahead a comprehensive renewable power policy framework, and institutionalised quite a lot of insurance policies and devices for China’s renewable power improvement and utilisation bringing the exploitation and use of renewable power to a “new strategic height”.  “The Renewable Energy Law is umbrella legislation where the details on the implementation are supported by various ministerial regulations and measures.”  A few of most related directives for the wind business embrace: The attribution of features and duties to the related authorities businesses (Artwork four, 5), directives on setting indicative renewable power targets (Art 7), directives on renewable power planning based mostly on targets set (Art 8), directions on know-how acquisition (Art 10-12), an order for grid enterprises to enter into grid connection agreements with renewable power enterprises (Art 14), path that grid worth energy of renewable power shall be determined by the worth authorities of the State Council (Article 19), directives on a Authorities finances for the development and help of renewable power sources (Artwork 24). Out of those the government’s investment into the renewable power sector and the order for grid enterprises to enter into agreements with renewable power enterprises are of elementary importance for the wind power sectors progress. Concretely, the order for grid enterprises to enter into agreements with renewable power enterprises meant that power grid corporations where required to signal a grid connection agreement with any state authorised wind energy producing firm and buy the complete amount of wind energy generated by it at a worth set by the federal government. By the top 2006 Nationwide Improvement and Reform Fee had accepted the development of 5 wind farms with minimal capability of 100 megawatts each.
Provisional Administrative Measure on Pricing and Value sharing for Renewable Energy Power Era (2006)
Shortly after the Renewable Energy Regulation was passed the National Improvement and Reform Commission issued the Provisional Administrative Measure on Pricing and Value sharing for Renewable Energy Energy Era. The regulation creates the legal framework enabling the Government to set the worth at which wind electricity needs to be purchased by grid corporations.
Medium and Lengthy-Time period Improvement Plan for Renewable Energy in China (2007)
The Medium and Long-Term Improvement Plan for Renewable Energy established particular targets for the Renewables. By 2010 China aimed to boost the share of renewable power consumption to 10 % and by 2020 to 15 % respectively.  Furthermore the coverage document also specifies targets for numerous renewable power sources as specified in Table 2 under. As we have now previously noticed, the targets are again based mostly on the put in producing capability relatively than the actual quantity of electricity provided to the related power grid.
The Medium and Long-Term Improvement Plan for Renewable Energy in China additionally establishes some national insurance policies and measures. These embrace the establishment of a sustainable and secure market demand for renewable power; the development of the market surroundings together with the development and extension of grids; renewable energy tariff’s and price sharing policies; to extend the fiscal input and tax incentives and to accelerate know-how enchancment and business improvement.  Underneath technological improvement we once more observe that China aims to have the know-how from inside the country: “By 2010, a basic system of renewable energy technologies and industry will have been established, so that equipment capabilities based mainly on domestic manufacturing will have been established.” 
Administration Strategies for Energy Grid Enterprises’ Purchasing of Renewable Energy Electrical energy (2007)
In June 2006, China’s Ministry of Finance issued the Tentative Management Technique for Renewable Energy Improvement Special Fund, providing “additional measures to enhance support for renewable energy development”. The coverage consists of assistance priorities, purposes for assistance tips, their screening and approval, financial management, exams and control. Importantly, the policy has empowered the central authorities to offer financial assistance for the development of renewable power assets together with wind power.
The special fund supplies grants and subsidies overlaying curiosity on loans, giving precedence to the development and utilization of three main renewable power sources: Renewable power sources as high potential and promising oil substitutes, renewable power sources associated to warmth provide and air con for buildings, and renewable power sources for energy era.  “More specifically, priority is given to the diffusion of solar and geothermal energy for heat supply and air conditioning for buildings, and to the diffusion fo application of wind, solar and marine energy for power generation.” 
Twelfth 5-Yr Plan (2011-2015)
Energy coverage in the 12th Five Yr focuses on decreasing air pollution, growing power efficiency and making certain a secure, reliable and clear power provide. Earlier than the discharge of the 12th 5 Yr Plan, China’s Director of the State Bureau of Energy Guobao Zhange emphasised that renewable power assets will continue to be central to China’s power policy and will probably be given even greater precedence in the upcoming 5-Yr Plan. 
On March 14 2011, China formally adopted its latest 5-Yr Plan saying a 11.4 % renewable power target for 2015 (up from eight.2 % in 2009). This is in line with China’s pledge to accumulate 15 % of its power from non-fossil fuels by 2020. Moreover Energy consumption per unit of GDP is to be reduce by 16 % and Carbon dioxide emission per unit of GDP are to be minimize by 17 %.  While the figures have been criticised for being too low, they’re however expected to have a big influence on the nation’s power portfolio stability as seen in Figure 1 under.
China’s head of the Energy Research Centre, Wenke Han, noted that underneath 12th 5 Yr Plan the investment into renewable assets will reach 470 billion USD. The brand new 5 yr plan also specifically mentions the introduction of sensible grids and decentralised power techniques to China because the country presently faces issues to connect its renewable power assets to its grid. At present 30 % of China’s built wind generators aren’t producing power as China is dealing with grid problems preventing them from getting used for power manufacturing.
More usually the 12th five yr plan goals to advertise technological innovation in the power sector resembling decentralised power system and clear coal; “to improve the macro framework to monitor the energy developments scientifically; to reform the pricing, tax and resource mechanism of energy gradually in order to foster an open and healthy market environment and to develop an improved policy and standard framework for sustainable energy developments”. 
China, in its wrestle for Energy Security, has been seen exploring a number of paths to make sure the nation won’t be topic to an power crisis in the longer term.
Themes of China’s Renewable Energy Legal guidelines and Policies
Based mostly on the beforehand analysed insurance policies, certain constant themes in China’s policy making emerge which are relevant to wind power. These embrace the continuous adjustment of its renewable power targets, concessions for the development of wind farms together with tax incentives and financial subsidies, low value bonds and government grants, renewable power worth fixing by the federal government, guaranteed grid connection and purchase of power, steady improve of the requirements for local manufacturing and high native content material renewables.
Issues of China’s Renewable Energy Policies and Laws
Chinas wind power policies have grow to be a robust backbone for the wind power business inside the nation over the past decade. Nevertheless, with the continual evolution of the insurance policies and the continual adaption of latest policies at numerous state ranges, certain issues relating to China’s policy behaviour have begun to emerge.
Lack of Coordination and Consistency in Coverage Making
One of the key issues with China’s renewable power insurance policies is the massive variety of authorities our bodies issuing insurance policies and laws. Whilst we discussed primarily insurance policies and laws issued by the State Commission of Improvement and Reform, the State Commission of Financial system and Trade, the Nationwide Individuals’s Congress and the Electricity Regulatory Fee there are still numerous further native and provincial our bodies that concern their very own insurance policies in help of the nationwide insurance policies. This outcomes in a policy and legal setting which isn’t only troublesome to supervise but in addition in an surroundings the place insurance policies diverge from one another.
“For instance, in order to reduce the investment cost in wind energy power plants, China canceled the tariff for importing wind energy power generators; while on the other side, the concerned sectors had been making active efforts to support the China-manufacturing process of wind energy power generation equipment implementing some model projects for the China-manufacturing process.”  An extra instance is the nullification of localization necessities outlined by the Requirements of Native Content material policy stating that a minimum of 70 % of the wind turbine gear must be produced regionally in order for the federal government to be eligible for government help. In a serious turnaround, the requirement was eliminated with the assertion issued by the State Commission of Improvement and Reform in November 2009 abolishing the Requirement of Localization of Gear Procurement on Wind Energy Tasks.  Such modifications in coverage course have a destructive impression on the coverage surroundings as it creates a great amount of uncertainty. China seems to adapt or change its insurance policies to be in line with what the federal government perceives as the appropriate plan of action at any given time which is not good for consistency.
Absence of Oversight
With the shortage of coordination and consistency of Chinas Legal guidelines and Insurance policies concerned with renewable energies comes the problem of oversight. With such an enormous amount of insurance policies on renewable energies it becomes increasingly troublesome to maintain monitor of all policy and legislative developments.
Weak spot and Incompleteness in the Encouragement System
While the legal frameworks for numerous incentives resembling tax incentives for instance are in place, their precise implementation is usually weak. Su and Tsen notice that most of the subsidies are symbolic slightly than really supporting an initiative.  An example of that is the taxation subsidies for renewable energies: “The actual taxation of most renewable energy projects are quite close to that of conventional energy, and some are even higher than that of conventional energy. This could not present the favorable conditions and policy for renewable energy. For instance, in according to the concerned favorable policies, RMB 0.25 yuan/(kW h) should be given to biomass energy power generation but this price is still about RMB 0.2 yuan/(kW h) higher than that of conventional power, plunging the biomass energy power generation into the bad at the very beginning.”  An extra situation with the encouragement system is that it’s typically incomplete. Taking a look at wind energy power for instance we find subsidies and incentives for the construction of wind power. Nevertheless, simply as essential is the grid extension so these wind farms might be related to the grid, and yet, there is a great lack of incentives in this space ensuing in wind farms that have the capacity on paper but don’t produce any power.
Lack of Innovation in Regional Coverage
China is blessed with monumental territory giving it an enormous quantity of alternatives to generate wind power in low population areas. Nevertheless, there are vital variations between totally different provincial states in addition to between east and west and north and south. China’s current coverage and legal framework does not account for these regional differences and is at present following a one mannequin matches all philosophy. “The regional renewable energy’s comparative advantage and industrialized competitive advantages have not been defined in accordance with the actual local conditions, which enormously hinders the development of renewable energy industry.” 
Limitations for Wind Energy
The New Promotion Renewable Energy Regulation of 2005 is the newest and perhaps probably the most complete physique of policy that intends to promote renewable power in China. Yet, era from renewables stays low where its enlargement has been disrupted and delayed by a couple of kinds of obstacles, i.e. monetary, innovation, institutional, technical. In the following paragraphs numerous limitations hindering the development of the wind energy as an power supply will probably be mentioned.
High Value of Creating Renewable Wind Energy
The excessive value of renewable power by comparison with coal-fired era continues to be a big barrier. “Modern renewable energy technologies are relatively nascent within the power sector, have yet to become fully-commercialised and unlike conventional energy technologies do not benefit from the decades of institutional and organisational adaptation.”  This drawback is particularly extreme in China because the Authorities has been motivated to maintain electrical energy costs low in help of GDP progress. This policy immediately conflicts with selling renewable energies and bringing the costs of them to parity with typical sources of power.
An extra contributor to value is china’s lack of technical degree in most renewable power industries despite the government’s research and improvement grants. This forces China to import the applied sciences from different nations ensuing in greater gear prices. In the case of wind turbines only 5 years it was discovered that developers of wind applied sciences in China needed to import gear from overseas at a price 60 % larger of that if it had been bought regionally.  Nevertheless, with the huge progress of the Chinese language wind we have now seen that Chinese wind corporations have more and more been managed to build and acquire their own know-how portfolio and are persevering with to take action.
The excessive up-front costs for wind power are additionally a considerable barrier for the renewable power resource. Buyers face a considerably larger up-front value with wind power than it’s the case with conventional fossil based mostly energies.
Grid Connection Problems
Presently 30 % of China’s constructed wind generators are usually not producing power as China is dealing with grid issues preventing them from getting used for energy production. That is each an issue of policy and know-how. The 12th 5 Yr Plan now specifically mentions the development of sensible grids so Wind energy can effectively be used as a source of power. Nevertheless, the event of sensible grids is very pricey and time consuming endeavour.
Dangers and Uncertainties
From an buyers perspective the renewable power market is that of excessive danger. Most renewable power applied sciences fall either in the Research and Improvement stage, in the pilot and demonstration stage, or in the early commercialisation stage with wind turbines presently categorized to being in the early commercialisation stage.  Furthermore Buyers are aware of the market entry dangers that the renewable power market bears in China. The Chinese power market is dominated by typical power enterprises which are in a highly advantageous position in regards to competing with renewable power corporations in phrases of measurement, resource worth and market penetration. Similarly the grid corporations are often not prepared to simply accept electricity generated from renewable power sources on account of their greater prices each on account of manufacturing costs and lack of economies of scale for the grid networks.
The shortage of know-how wanted to build giant wind turbine motors or grid connection know-how does not solely outcome in excessive costs but in addition in high dangers for Buyers. So are for example China’s formidable plans to broaden into the western wind markets challenged by the shortage of know-how limiting the dimensions of wind generators. Whereas the mainstream wind turbines in the European market are as giant as 1.5MW per unit; China does not yet have the capacity to manufacture wind generators of more than 1MW.  The shortage of grid connection applied sciences is an extra example of technological danger as buyers face the state of affairs of having wind generators ready for energy era however unable to do so as a result of they will’t be related to the grid. As beforehand talked about an estimated 30 % of China’s built wind generators usually are not producing power as China is dealing with grid problems stopping them from being used for energy manufacturing.
China’s Renewable Energy Regulation which took impact in January 2006 was the first state degree coverage handed with the only function of selling renewable energies. It’s implementation was nevertheless closely debated. Particular mechanisms and strategies for premium transfer and grid-connection value administration have not but been carried out and neither have particular and constant plans for using the China’s special fiscal fund for renewable improvement carried out.  Xilang et al. observe that the debates over feed-in tariff and public bidding appear to be each persistent and inconclusive. Further coverage associated danger is that of the coverage driven market. With the renewable power sector’s survival dependent on Chinese language insurance policies their consistency and implementation significantly impacts the market of renewable assets and play a vital position in investor selections. All these coverage uncertainties mentioned add danger for the investor considering the Chinese wind power sector.
China has been experiencing a speedy improve in power consumption through the past many years and with it came issues such pollution, greenhouse fuel emissions and power security. The event of renewable power sources is important for China to deal with those points with wind power bearing great potential as one such various renewable useful resource. Wind power has seen robust authorities help in China and has made leaps in installation capability with wind energy having grown 36-fold throughout from barely over 1GW to 44.8GW capability in the course of the 2005 – 2010 period.
We observed a large amount of policies in the renewable power area which are concerned with wind energy. China has been constantly growing its renewable power targets, issued insurance policies relating to concessions for the development of wind farms including tax incentives and monetary subsidies, relating to renewable power worth fixing by the government, relating to guaranteed grid connection and the definitive buy of energy created by wind farms and relating to excessive local manufacturing content. Based mostly on the good potential of wind power in china and the robust authorities help it’s expected that the business will proceed to grow at a considerable price adopted its. In the 12th Five-Yr Plan China introduced that it plans to have renewable assets make up 11.4 % of its power portfolio in 2015. Wind is predicted to play a substantial half in China’s power portfolio diversification with a deliberate 100GW capability of wind power by 2015, a tenfold improve since 2010.
Nevertheless, with the huge amount of insurance policies issued by China relating to renewable energies and wind power sure issues started to emerge. A scarcity of coordination and consistency in China’s coverage making was discovered. Instance of this included the implementation and cancellation on tariffs for importing wind power energy as well as the nullification of localization necessities. Such modifications in policy course have a damaging impression on the policy setting because it creates a large amount of uncertainty. China seems to adapt or change its insurance policies to be in line with what the federal government perceives as the proper plan of action at any given time which is not good for consistency. Further issues identified where the shortage of completeness of renewable power promotion policies and the shortage of innovation in regional coverage.
Moreover numerous obstacles to the efficient improvement of wind energy as a renewable power supply the place recognized. These included the excessive improvement and up-front costs for wind generators, grid connection problems and risks and uncertainties for buyers. Never the less, regardless of the policy issues and obstacles recognized wind power is predicted to proceed to develop considerably inside the subsequent decade as certainly one of China’s key renewable assets.
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