Why is China the World’s Leader of Solar Water Heater Production and Consumption?

Sustainable energy programs in developing countries face many challenges. The purpose of this research is to examine why China has been successful as the world’s leader of Solar Water Heater (SWH) production and consumption. The study is based on field work in China in the past two years in areas where SWHs are widely used. The results may help provide a better understanding of the main drivers for the rapid growth of renewable and sustainable energy and develop associated policies. The research is based on data from current reports on SWH production and consumption in China and field investigations in Chinese cities and rural areas where SWHs are widely used. The findings are limited by the availability of data and the varied physical and cultural conditions in China. The research finds that several factors may have contributed to China’s leadership in this area: governmental policies, innovations in technology, low costs of labor, low interest rates, government incentives, a large market, a new installation, shortage of electricity and social acceptance. China’s SWH production and consumption is mainly due to economic incentives and cultural appeal instead of consumer environmental concerns. The Chinese SWH experience confirms earlier findings that low levels of development should not prevent countries from having effective environmental institutions and policies. In addition to technological innovations, policies for renewable and sustainable energy need to pay more attention to economic, political and cultural factors.