China has significantly ramped up spending on its power networks to better integrate the country’s expanding solar capacity, leading the world in renewable energy development. According to the National Energy Administration (NEA), grid investment surged by approximately 33% during the first two months of 2025, a pace more than double the average increase projected for the year.
The total investment reached 43.6 billion yuan ($6 billion) in that period. However, this figure still falls short of the required level to meet the target of 820 billion yuan for the full year, which is necessary for the two state-owned utility giants, State Grid Corp. of China and China Southern Power Grid Co., to meet their infrastructure goals.
As the world’s largest producer of solar energy, China is set to lead global solar installations again this year, contributing more than half of the worldwide growth, as projected by BloombergNEF. However, the rapid expansion of solar power has created challenges in integrating the new capacity into the grid, forcing the country to limit the amount of solar energy being distributed. The government aims to address these issues by bolstering network investments, particularly through the aforementioned utility giants.
Solar capacity installations surged by nearly 43% in January and February, although this is a slight decline from the 57% growth rate recorded during the same period last year, according to NEA data. Solar now makes up about three-quarters of all new power capacity, with thermal and wind power developments falling behind last year’s figures.
As China races to meet its renewable energy goals, domestic developers are working rapidly to connect smaller rooftop solar projects before May 31, the deadline for a new power trading program that is expected to heighten competition in the sector.
Industry forecasts suggest that new solar installations in China this year may dip to around 215 gigawatts, a decrease from the record 277 gigawatts added in 2024.
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