Cost-effective policy on renewable energy could be made based on information of renewable energy industry development and carbon dioxide control strategy. To analyze the interaction of renewable energy policy with CO2 control strategy, we developed a recursive linear planning model. The year 2004 is set as the base year. The target years are 2015, 2025, 2035, and 2045. Fujian province in China is selected as a case for the study. Calculation results show that in some instances, renewable energy subsidy policy and clean development mechanism incentive could not drive the market as policy makers expected. Careful design is required for renewable energy policy and carbon dioxide control policy, especially for developing countries. This study shows that a recursive linear program could be applied to an integrated study of renewable energy policy and carbon dioxide control policy.