The Stanford Steyer-Taylor Center for Energy Policy and Finance is engaged in a multi-year research project designed to minimize the cost of a shift to a cleaner international energy system by helping countries — particularly China and the United States — approach it with a new level of economic efficiency. The rationale for the center’s China Project is that many of the clean-energy policies that countries have adopted thus far have been inefficient. The result, in much of the world, has been wild swings in clean-energy policy, ranging from unnecessarily generous support to unreasonable neglect. That has contributed to a boom-bust pattern that has benefited no one: not investors, clean-energy-technology entrepreneurs, ratepayers, taxpayers, or citizens around the world who could benefit from an energy system decarbonized sooner rather than later. Enabling cleaner forms of energy to scale to a level that can help curb fossil-fuel emissions requires governments to find smarter means of policy and financial support. One key predicate for making smarter policy is taking into account a country’s relative comparative advantage in the rapidly globalizing solar industry: what it does well and what it does not.
In March 2017, the Stanford Steyer-Taylor Center released a major report produced through its China Project. The New Solar System outlines an economically efficient path to scale up solar power. Based on two years of research, The New Solar System illuminates key and little-understood changes remaking the solar enterprise in China, the center of the global solar industry. In doing so, the report busts several prevailing myths about the Chinese solar industry. Based on those findings, The New Solar System recommends changes to U.S. policy to put solar power on a more cost-effective course for the world. The changes would involve a more-nuanced U.S. approach to China — an approached that rests on each country playing to its comparative strengths. The New Solar System was the subject of a New York Times op-ed.
Jeffrey Ball, the Stanford Steyer-Taylor Center’s scholar-in-residence and the lead author of The New Solar System, leads the China Project. The project has included a Stanford Law School “policy lab” in which students from Stanford schools including law, business, and engineering have helped with research. The project also has included workshops with a wide range of experts; those workshops have been held in Beijing, in Shanghai, in Washington, and at Stanford.
The publication of The New Solar System marks the culmination of the first phase of work at the Stanford Steyer-Taylor Center into ways that China and the United States could scale up cleaner energy more economically by playing to their comparative strengths. In the next phase of the work, the center’s China Project will pursue one of the most important findings of the research thus far: that senior leaders in China are eager to import to China more-efficient clean-energy-investment structures pioneered in the West. Improving the efficiency of clean-energy finance in China has been little discussed. If developed, it could help significantly to achieve meaningful carbon reduction.