Renewable Energy Law delivered because of early foundational work

This year marks the 20th anniversary of China's Renewable Energy Law coming into force. Over the past two decades, the country's wind power capacity and solar power capacity have increased markedly, transforming the country's energy landscape beyond recognition.

There is no doubt that an effective legislative framework, tailored to national conditions, played a pivotal role in this green transition — an important lesson for other developing countries racing to advance their energy transitions.

Yet, as these countries look to China for inspiration, they risk focusing too much on the law itself while overlooking that it was the culmination of a long-term, deliberate national strategy. Many developing nations today worry that importing Chinese equipment may stifle the growth of their domestic industries. However, in the years leading up to the law, China actively welcomed foreign technology through preferential import policies.

In 2005, China introduced a policy to exempt import tariffs and value-added tax on imported complete wind turbine units with a capacity greater than 800 kilowatts. Then in 2008, the policy was adjusted to shift the focus from finished turbines to key components to encourage domestic manufacturing.

By importing advanced equipment, China accelerated the upgrading of its domestic technological capacity, establishing a foundation for future localization.

Recognizing its initial technological disadvantage, the country also pursued international collaboration through technology imports, joint ventures and pilot projects. In the 1980s and 1990s, for instance, early wind farms were developed using turbines from Danish and Belgian manufacturers. During this period, China adopted a strategy of "exchanging market access for technology".

This was essential not just for installing capacity, but for cultivating technical expertise, building a skilled industrial workforce and nurturing the managerial talent that would later drive large-scale deployment. The law alone could never have delivered the transformation that followed.

Crucially, China coupled this openness with strategic industrial policies — such as mandatory localization rates in wind power projects — to systematically digest, absorb and innovate upon foreign technology. This process steadily increased the share of domestic manufacturing.

The Renewable Energy Law then provided the key framework. It established mechanisms such as feed-in tariffs, which helped unleash massive social capital into the sector, enabling the industry to stand on its own feet.

This guidance, which was gradually phased out, enabled explosive growth in wind and solar electricity from contributing a negligible fraction of power two decades ago to meeting more than one-fifth of China's electricity consumption, with the nation accounting for nearly half of the world's total installed capacity.

Li Chuangjun, director general of the Department of New Energy and Renewable Energy Sources of the National Energy Administration, once stressed, China's new energy technology innovation has gone through three stages: introducing foreign technology, digestion and absorption and re-innovation. Through international cooperation, it rapidly narrowed the gap, drew on the strengths of others, and ultimately achieved fast development.

China's success was not merely the product of a single law, but of a coherent strategy that combined openness to foreign technology with long-term efforts to build domestic capabilities. The Renewable Energy Law delivered its transformative impact precisely because it arrived after decades of foundational work — not in place of it.

Developing nations should heed China's experience: embrace foreign technology as a learning tool, but pair it with policies that ensure the knowledge is absorbed, adapted and eventually owned. The goal is not perpetual reliance on imports, but the deliberate cultivation of indigenous capacity — so that when the legislative framework finally arrives, the industrial ecosystem is ready to seize the opportunity.