Although solar costs are dropping rapidly, solar power is still more expensive than conventional and other renewable energy options, and the solar sector still needs continuing government policy support. However, government policies are driven by objectives that go beyond the goal of achieving grid parity. These include increase in renewable energy generation to mitigate climate change, or boost energy security; develop domestic industry to create jobs and exports; develop technology and intellectual property rights via RD&D; and improve access to electricity where the electric grid is unreliable or absent. The need to achieve multiple objectives and ensure sufficient political support for solar power makes it difficult for policy makers to design an optimal solar power policy. The dynamic and uncertain nature of the solar industry, combined with the constraints offered by broader economic, political and social conditions further complicates the task of policy making.

This report presents an analysis of solar promotion policies in seven countries - Germany, Spain, the United States, Japan, China, Taiwan, and India – in terms of their outlook, objectives, policy mechanisms and outcomes. The report presents key insights, primarily in qualitative terms, and recommendations for policy makers to optimally design their solar policies by balancing national objectives and paying capacity with the global objective of solar power cost reduction in order to realize its full potential.