This paper presents initial findings on a current approach in public policy to promote green technology diffusion using innovative policy measures, through the case of the electric motor upgrading project (EMUP), and examines the degree of success of local governments in their effort to encourage the adoption of high efficiency motors (HEMs). The barriers to green technology diffusion are explored to showcase the challenges faced by local implementer. This research demonstrates the successes of various regions with an emphasis on Dongguan City, which has enjoyed great success using subsidies and financial tools to promote the use of energy performance contracts as an innovative financing mode. Finally, this article analyzes the methods and outcomes of the EMUP, thus far, in order to explain the reasons behind the success of this initial phase of implementation. Further research will be needed to monitor the progress of this initiative. This article summarizes the policy system and the new model will help to promote the development of energy conservation and environmental protection industry in the strategic emerging industries.