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China Solar Growth Stalls as Five-Year Plan Shifts Focus

Bloomberg Markets •
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China's latest five-year plan notably omitted ambitious solar energy targets, marking a shift after years of rapid expansion. The plan released at the National People's Congress failed to set installation goals for 2030, contrasting with targets for offshore wind power and nuclear energy. Solar's mentions were minimal compared to previous plans.

This change follows solar power generation surpassing wind for the first time last year, driven by cheap panel production making solar highly competitive. However, the rapid growth has strained the grid, leading to curtailments and reduced returns for developers. China now faces new challenges integrating renewables into the power network and industrial economy.

The government is redirecting attention to grid expansion, energy storage, and balancing variable power generation through initiatives like pumped hydro and zero-carbon industrial parks. As renewables reach higher shares in the power mix, the focus naturally shifts toward system integration. This requires structural changes to systems historically designed around fossil fuels, prompting new policy attention and initiatives.