In China, the government provides low-interest loans (i,e.6%) and tax incentives for New and Renewable Energy (NRE) projects. The projects also get local autonomy in the special economic zone if they cost less than 50 million RMB. Some of these incentives are presently supporting wind turbine manufacturing and market development in china. The government has also prioritized the development of small hydropower (SHP) through regulation and improvement of a series of policies in SHP development. The main thrust of the government in this direction is to encourage local population under the scheme of 'self-reliance' , 'self-construction', 'self-management' and 'self-consumption'.

Three state agencies, the Ministry of Science and Technology (MOST), the State Development and Planning Commission (SDPC), and the State Economic and Trade Commission (SETC) have jointly set up a 'Program on New and Renewable Energy Development in China (1996-2010)'. The major targets of this program include 13.4 million hectares of fuel wood plantation,4 billion cubic meters of biogas supply to 12.35 million households ,117GWh electricity from small hydro ,4.67 mtce of solar energy,1000-1100MW of wind power capacity and 50 MW of tidal power capacity. The same three organizations have also launched a photovoltaic program, which is known as the 'sunlight Program¡¯. The program, which will run up to 2010 is expected to upgrade country's manufacturing capacity of polycrystalline and other advanced silicon technologies; to establish large scale PV and PV/hybrid village power demonstration systems, home-PV projects for remote areas; and to initiate grid-connected PV projects. Other notable programs include the 'Brightness Program' and the 'Ride the Wind Program¡¯. The first has been instituted by the SDPC through the bilateral and multilateral assistance aiming to install several solar and wind power systems in the northwest part of China .The second (also know as Chengfeng Program) is a bilateral co-operation program, which has already installed a total of 110 MW wind turbines in the various parts of the country by the end of 1998. Besides these programs, a GEF/World Bank renewable energy development program is also in the pipeline. This program will support the installation of 200MW of wind farms by IPPs; installation of 200,000 PV solar home system by private firms and strengthening of institutional capacity, business skills and project management in the field of renewable energy in china.