China has turned solar power into a strategic industry on a scale no rival has matched, reshaping everything from panel prices to geopolitical leverage. In little more than a decade, it has built a manufacturing juggernaut that now dominates the global supply chain and is racing toward unprecedented levels of installed capacity at home. The result is a world in which the pace and price of the energy transition are increasingly set in Beijing, whether competitors like it or not.
From energy vulnerability to industrial supremacy
The roots of China’s solar surge lie in a deliberate decision to turn a perceived weakness into an advantage. In 2009, the Chinese government concluded that heavy dependence on imported fossil fuels and foreign-controlled technology left the country exposed, and it responded by pouring large sums of renminbi into clean energy infrastructure and manufacturing capacity. That early bet, described in detail by analysts who track the Chinese government, created the foundation for a solar industry that could scale faster and cheaper than its Western counterparts.
What began as a push to cut import bills has since evolved into a central pillar of national strategy. Today, China is not just the world’s largest installer of solar panels, it is the primary source of the polysilicon, wafers, cells and finished modules that power projects from Texas to Tunisia. By nurturing domestic champions, aligning industrial policy with climate goals and tolerating years of thin margins, Beijing has effectively written the playbook for how to win a clean energy race that others are still learning to run.
Supply chain dominance built on scale and policy
China’s grip on solar manufacturing is now so tight that it is hard to overstate. Analysts expect the country to hold over 80% of global solar manufacturing capacity through 2026, a share that reflects both aggressive factory buildout and relentless cost cutting. One detailed assessment finds that this represents 17 times more capacity than the rest of the world combined, with Looking outside China, India is forecasted to overtake Southeas Asian competitors only with the help of strong PLI incentives. That imbalance means any shift in Chinese production, pricing or policy ripples instantly through global markets.
Policy support has been the crucial accelerant. A recent examination of how expansion will affect global module supply chains concludes that generous subsidies, cheap land and low-cost financing have allowed China to keep building even when margins are razor thin. The same analysis, titled “How will China’s expansion affect global solar module supply chains?”, notes that this policy-driven surge has created concerns about oversupply, with some factories elsewhere in the world forced to operate below capacity or shut down entirely. In effect, Beijing has used industrial policy not only to dominate a green technology, but also to set the terms on which others can participate.
Oversupply, price wars and Beijing’s course correction
The flip side of such dominance is volatility. As factories across China ramped up, module output began to outstrip demand, triggering a wave of oversupply that pushed prices steadily lower. Analysts tracking the sector describe how this glut has squeezed manufacturers’ margins and raised questions about the long term sustainability of the current buildout. In response, the Chinese government has moved to nudge prices higher, encouraging producers to charge more for solar components in an effort to stabilize the sector heading into 2026.
Other observers frame the oversupply as both a risk and an opportunity. One detailed review of the solar panel boom notes that persistent excess capacity has kept module prices falling, but warns that Countries must step up on testing, certification and long term performance standards if they want to avoid quality problems as cheap panels flood their markets. The same analysis highlights the Strategies other nations are adopting, from local content rules to targeted subsidies, to avoid being completely sidelined by China’s scale. I see that tension as the defining feature of the current moment: low prices are accelerating the global energy transition, but they are also entrenching a single-country supply chain.
Gigawatt-scale deployment at home
China’s solar story is not just about exports, it is also about a domestic buildout that dwarfs anything seen before. Modeling by Rystad Energy shows total installed solar photovoltaic capacity in China is on track to cross the 1,000 G mark by the end of 2026, a terawatt scale milestone that would have seemed implausible only a few years ago. That surge is being driven by utility scale projects in the country’s sunny western regions, as well as rooftop installations in industrial hubs that are under pressure to cut emissions and energy costs.
Short term, there are signs that this breakneck pace may ease slightly. Forecasts from BNEF suggest a 2026 solar slowdown, with China’s own deployment decelerating after peaking at 372 G of new capacity in 2025. Yet even a modest cooling would still leave China adding more solar each year than most regions have installed in total, reinforcing its role as both the world’s largest producer and its largest consumer of photovoltaic power.
Geopolitics, materials bottlenecks and the next phase
China’s solar dominance is increasingly a geopolitical story as well as an industrial one. European policymakers warn that China is systematically embedding itself in global renewable energy supply chains, connected devices and the European energy system, including through state funded cross border projects. At the same time, a separate analysis finds that Wood Mackenzie expects China to control over 80 percent of the world’s production of polysilicon, wafers, cells and modules from 2023 to 2026. That combination of infrastructure presence and supply chain control gives Beijing significant influence over how quickly and cheaply other countries can decarbonize.
Even inside China, however, the path ahead is not friction free. Rising raw material costs are forcing a rethink of long standing cell designs, with one detailed report warning that China’s solar industry is meeting its silver limit as higher prices for the metal challenge traditional approaches to collecting and transporting electricity in Solar cells. At the same time, global competitors from India to the United States are experimenting with their own industrial policies to chip away at China’s lead. For now, though, the numbers are stark: Beijing’s early bet on clean energy has turned the country into a solar superpower, and the rest of the world is still figuring out how to live with that reality.
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