Fragmentation, Centralisation and Policy Learning: An Example from China's Wind Industry

Abstract

This paper seeks to understand what government mechanisms have allowed China's wind industry to grow as fast as it has over the past ten years. Instead of formal rules and regulations, this paper focuses on specific sets of institutional conditions that have been crucial in the process of high-speed implementation of wind energy in China. Specifically, fragmentation and centralisation, together with policy experimentation and policy learning, have been fundamental for policy flexibility and institutional adaptability. The paper illustrates that there are benefits and disadvantages to these characteristics, and that inherent qualities of China's governing system that lead to rapid growth overlap with those that lead to challenges in terms of quality and long-term performance.

The leapfrogging opportunity: The role of education in sustainable development and climate change mitigation

“…As stated by Mah and Hills (), policy learning took place, which was reflected in a revision of pricing policies for wind energy based on a reflection on environmental concerns, rather than just technical aspects. The broad framework for pricing policy in the wind energy sector increased the scope of experimentation in the implementation of policy measures, generated learning, and helped in refining policy instruments and adopting successful policies at the national level (Andrews‐Speed, ; Korsnes, ).…”

Tackling Chinese Upgrading through Experimentalism and Pragmatism: The Case of China's Wind Turbine Industry

“…Meanwhile, the concession programme introduced evaluation criteria which favoured domestic state-owned wind farm developers, and lowest-bid prioritisation often meant that foreign manufacturers were unable to win bids (Lewis 2013: 82; Chen and Lees 2016: 578). Second, the influential 2005 Renewable Energy Law and several five-year plans resulted in the rapid growth in installed wind power capacity, in manufacturing upscaling, and in the large-scale commercialisation of wind farms (Li 2010;Korsnes 2014;Klagge, Liu, and Silva 2012;Lema and Ruby 2007). Third, wind farm planning was fragmented and often decentralised during phase two, leading to head-on provincial competition for the largest installed capacity, which soon led to overheated investments.…”

“…Third, the government also changed its price-setting model and began to increasingly concentrate on quality by, inter alia, (i) gradually changing the focus of China's concession projects from competitive bidding towards other quality-related criteria (Korsnes 2014;García 2013: 130) and (ii) pragmatically experimenting with proper levels for the support scheme (Zhao, Wang, and Wang 2012;García 2013;Korsnes 2014).…”

“…Fourth, the Chinese government decided to increase its centralised control over wind power development by requiring national-level approval for large wind farm projects. This move was intended to counter overheated investment activities at the local provincial level (Yu, Zhang, and Chen 2009;García 2013;Korsnes 2014;Kirkegaard 2015) and proved central to the turn to quality.…”

“…Within the last decade, China has emerged as the world leader in wind power, shaking up old competitive relations in the global value chain of the wind turbine industry (GWEC 2016;Kirkegaard 2015;Lewis 2013;Korsnes 2014;Lema, Berger, and Schmitz 2013;Chen et al 2014;Mathews and Tan 2015). In 2015 China boasted an astonishing 33.6 per cent of global cumulative installations (GWEC 2016: 32).…”