China calls for ‘concerted’ efforts to tackle excess solar production

China has called for a “joint effort” to ease a severe overcapacity crisis in the solar industry as part of a campaign to end Beijing’s bitter price war.

The proposed measures include capacity control, standard guidance, price enforcement, mergers and acquisitions, and intellectual property protection “to promote the high-quality development of the photovoltaic industry.”

China’s solar energy production capacity far exceeds global demand, triggering a domestic price war in recent years.

country makes more than 80% The world has 100% of solar panel components, according to the International Energy Agency, but the industry is struggling with overcapacity due to intense internal competition, which the Chinese government calls “involution.”

The move comes shortly after a meeting on Friday between institutions including China’s Ministry of Industry and Information Technology and the National Development and Reform Commission, as well as the China Photovoltaic Industry Association and major state-owned power generators that purchase solar power, such as China Huaneng Group and China Datang Corp.

“The meeting called for strengthening inter-ministerial coordination and concerted efforts to continuously deepen the management of the photovoltaic industry and fully promote comprehensive governance regarding ‘anti-involution’,” China’s Ministry of Industry and Information Technology said in a statement. he said. expression According to Google translate it’s on Monday.

China’s solar overcapacity problem has been exacerbated by a growing sense of resistance from high-value overseas markets, with the United States aggressively imposing tariffs on solar products from China and the European Union diversifying its solar supply chain away from Beijing.

In response, the Chinese government launched an “anti-revolutionary” campaign aimed at reducing production capacity and ending unregulated pricing schemes.

Analysts told CNBC that the effects of the U.S.- and Israel-led war on Iran will likely accelerate the shift away from fossil fuels and cause countries to think differently about the role renewables can play in supporting energy security, potentially increasing demand for solar energy.

Chinese solar manufacturers he told Reuters But last week, any expected increase in global renewable energy demand due to the war energy price shock in Iran was unlikely to ease the sector’s overcapacity problem.