BUSINESS

Chart of the Day: China’s New Solar Build Out Plunges

Published: Jul. 24, 2026 6:35 p.m. GMT+8

00:00

00:00/00:00

Listen to this article 1x

China’s newly installed solar capacity plummeted 66% year-on-year in the first half of 2026 to 72.1 gigawatts (GWs) as the sector grappled with overcapacity and depressed prices.

The sharp contraction underscores a painful restructuring phase for China’s photovoltaic industry, driving major manufacturers deep into the red and threatening to drag down global solar installation growth this year.

You've accessed an article available only to subscribers

Subscribe today for just $.99.

VIEW OPTIONS

Unlock exclusive discounts with a Caixin group subscription — ideal for teams and organizations.

Save an extra $50. Introductory offer for new readers. Subscribe now.

Share this article

Open WeChat and scan the QR code

DIGEST HUB

Digest Hub

Back

Explore the story in 30 seconds

China's new solar capacity fell 66% YoY to 72.1 GW in H1 2026 amid overcapacity and low prices, with module output dropping 35.1%.
Major manufacturers projected losses, including Tongwei (up to 5.4b yuan) and Longi (loss widened 32%-48% YoY).
CPIA expects China's 2026 new solar installations to decline 24%-43%, and global additions to fall 8% to 612 GW.

AI generated, for reference only

Explore the story in 3 minutes

1. [para. 1][para. 2][para. 3] China's newly installed solar capacity plunged 66% year-on-year in the first half of 2026 to 72.1 GW, highlighting a painful restructuring phase driven by severe overcapacity and depressed prices. Wang Bohua of the China Photovoltaic Industry Association (CPIA) noted that despite the sharp drop, additions remained above the 2021-2024 average. He attributed the contraction to a high comparison base and lower project profitability, which curbed investment enthusiasm.

2. [para. 3][para. 4][para. 5] In response to the overcapacity, manufacturers along the country's photovoltaic supply chain scaled back production significantly. Module output suffered the steepest decline, plunging 35.1% year-on-year. Output of polysilicon, wafers, and solar cells fell by 9.8%, 7.3%, and 21.9%, respectively. Meanwhile, prices remained heavily depressed since the start of 2026; polysilicon, wafer, and solar cell prices dropped by 42.3%, 28.7%, and 27.7%. The module price was a rare exception, edging up 3%.

3. [para. 6][para. 7][para. 8] The supply-demand imbalance has pushed major manufacturers deeply into the red. Tongwei Co. expects the largest projected loss among leaders, between 4.8 billion yuan and 5.4 billion yuan ($709m-$800m). Longi Green Energy estimates its first-half loss widened by 32% to 48% year-on-year to 3.4-3.8 billion yuan. Trina Solar's headline loss narrowed 90% to 180-360 million yuan, but its core loss after excluding nonrecurring items was 2.8 billion to 3 billion yuan (flat year-on-year). JA Solar projected a loss of 2.4-2.9 billion yuan, citing intense competition, canceled export tax rebates, trade friction, and geopolitical logistics disruptions.

4. [para. 9][para. 10] The CPIA forecasts China's full-year 2026 solar installations at 180-240 GW, a 24% to 43% decline that would mark the first annual contraction since 2019. Wang Bohua warned that weakening domestic demand will drag down the global solar market, predicting a global fall of 8% to 612 GW in 2026. However, he anticipates a broader global recovery after 2027, with new installations projected to grow at a 7% compound annual growth rate from 2026 to 2030.

AI generated, for reference only

Who’s Who

AI generated, for reference only

What Happened When

Before 2026：: China Photovoltaic Industry Association (CPIA) forecast China's new solar installations for 2026 at 180–240 GW, a year-on-year decline of 24%–43%, first annual contraction since 2019.

First half of 2026：: China's newly installed solar capacity plummeted 66% year-on-year to 72.1 GW, data delivered by Wang Bohua at a Thursday industry conference in 2026.

First half of 2026：: Output of solar modules fell 35.1% year-on-year, and production scaled back across the photovoltaic supply chain due to severe overcapacity.

First half of 2026：: Major solar manufacturers projected losses: Tongwei Co. expected a loss of 4.8–5.4 billion yuan; Longi Green Energy estimated first-half loss widened 32%–48% year-on-year to 3.4–3.8 billion yuan; Trina Solar expected first-half loss to narrow 90% year-on-year; JA Solar projected a loss of 2.4–2.9 billion yuan.

Since start of 2026：: Prices of polysilicon, wafers, and solar cells dropped 42.3%, 28.7%, and 27.7%, respectively, while module price edged up 3%.

AI generated, for reference only