The China Photovoltaic Industry Association (CPIA) projects solar capacity additions of 215 to 255 GW in 2025, Chairman Wang Bohua stated at the group’s annual conference in Beijing on Thursday.
China added 277 GW of solar capacity in 2023, surpassing the previous record of 217 GW set in 2022. The growth occurred despite industry challenges, including a supply surplus that led to significant losses for major manufacturers.
The rapid expansion of solar power, which generates electricity only when the sun is shining, has increased pressure on grid infrastructure. Investments in transmission lines, energy storage, and digital management tools are needed to optimise power usage.
In response, the government has introduced new power market regulations, set to take effect on June 1. These changes will allow market forces to determine the rates that wind and solar generators receive for electricity, presenting new challenges for the sector.
S&P Global solar analyst Hu Dan noted on Wednesday that a surge in installations is expected in the second quarter of 2024, as developers aim to benefit from existing pricing policies before the transition to market-based rates.
Bohua indicated that the new regulations, stricter policies, and connection challenges for distributed rooftop solar, have put the industry in a “wait-and-see mood, thereby increasing the uncertainty around expected installations in 2025.”
According to Bloomberg Economics, China’s economic targets set at the 2025 National People’s Congress will provide insights into macroeconomic policy, with inflation objectives being particularly significant.
Meanwhile, China is expanding lithium extraction as a byproduct of alumina production to bolster domestic supply. Falling coal prices have also impacted the market, with mining shares declining after Citigroup downgraded ratings due to slower demand and lower prices.
[Image credit: Bloomberg]
