A new round of large-scale investment trends in the Chinese PV market
August 27 09:08:30, 2025
Since July, with the introduction of the State Council's "Several Opinions on Promoting the Healthy Development of the Photovoltaic Industry" (referred to as the "Opinion"), a new wave of investment in the photovoltaic sector has taken off. Major projects such as the nearly 30 billion yuan power-free population photovoltaic independent power supply initiative, led by Huaneng, Datang, Guodian, and Huadian, have been launched. Additionally, China National Machinery Industry Corporation invested 20 billion yuan in a 2,500-megawatt desert ecological photovoltaic power station in Ningxia. AVIC also saw the largest single distributed photovoltaic project. All these developments are primarily driven by state-owned enterprises.
Wang Sicheng, a researcher at the Energy Research Institute of the National Development and Reform Commission, noted, “The latest large-scale investment in China’s PV market is clear. However, this time it's not private companies but central enterprises leading the way.â€
Private enterprises, once the driving force behind the industry, are now facing challenges. Their access to financing has been limited, and the long-awaited subsidy policy remains unimplemented. This has left many private firms hesitant to invest further. Before 2009, the photovoltaic industry was highly dynamic, dominated by private giants like Yingli, Suntech, and Trina Solar. However, after the global downturn in 2009-2010, many companies faced severe financial difficulties, especially after the EU and U.S. "double reverse" policies hit their markets hard.
Despite past successes, these companies have experienced sharp declines. Miao Liansheng, chairman of Yingli Group, recently emphasized that funding remains the biggest challenge for the domestic industry. Although photovoltaic power plants offer stable returns, they require significant capital, which is difficult for private firms to maintain. Banks have tightened credit, even avoiding loans to PV companies altogether, hindering industry growth.
While the "Opinions" include supportive financial policies, implementation remains slow. Liu Peng from Youtai New Energy pointed out that banks haven’t shown signs of relaxing their stance yet. He hopes that clearer national policies will restore confidence among financial institutions.
Meanwhile, the government plans to increase on-grid tariffs and subsidies for photovoltaic projects. The proposed changes include raising the benchmark tariff for large-scale projects and increasing distributed generation subsidies. These updates aim to align with previous demonstration zones, but private companies remain cautious due to uncertainty.
In contrast, central enterprises are aggressively expanding into the photovoltaic sector. After receiving over 50 billion yuan in projects, companies like Guodian Technology Environmental Protection and China Merchants New Energy have formed the Green Photovoltaic Eco-Cooperative Organization. Their goal is to build a national photovoltaic power unit integrating equipment supply, financing, and operations. This move highlights the growing dominance of state-owned enterprises in the downstream sector.
Zhang Wei noted that while private companies lack the capital and face strict lending conditions, central enterprises benefit from strong credit support. Xu Jietan from the aerospace and electromechanical department confirmed that central SOEs have an advantage in securing guarantees and financing for large projects.
Wu Xinxiong from the National Energy Administration explained that many projects are located in remote western areas, where high costs and low returns make them less attractive to private firms. While acknowledging the capabilities of state-owned companies, Zhang Wei urged caution, warning that some central enterprises may be pursuing projects without regard for profitability.
Financial commentator Zhou Junsheng criticized the current rush as a repetition of past government-driven investments, warning of potential overcapacity. He stressed that market acceptance is key to ensuring that large-scale investments lead to sustainable growth.
Looking ahead, Zhang Wei believes that central enterprises will soon expand into the photovoltaic component manufacturing sector, signaling a shift in the industry landscape.
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