As expected, China’s solar PV capacity additions continue their downward spiral after strong monthly additions till May 2025. For the month of August 2025, PV deployments declined to a ‘paltry’ 7.36 GW AC, according to the country’s National Energy Administration (NEA).
August additions are down more than 55% from 16.46 GW AC reported for August 2024, and over a 33% decline from 11.04 GW AC in June this year (see Chinese Solar Installations Expanded By 16.46 GW In August 2024 and China’s July 2025 Solar PV Additions Drop Further To 11 GW).
The decline was widely anticipated following the implementation of market-oriented pricing reforms in June this year. However, China’s PV installations still increased by 90.62 GW AC year-on-year (YoY) – from 139.99 GW AC in the first 8 months of 2024 to 230.61 GW AC during the same period in 2025.
It remains to be seen how much more it will install during the last 4 months of the year. Assuming the installations continue to be this low for the rest of the year, the country would reach around 255 GW AC – exactly matching the China Photovoltaic Industry Association’s (CPIA) forecast from February, and down from its revised upward projections of up to 300 GW AC in the summer. In any case, it will be nowhere close to the State Grid’s estimate of 380 GW AC (see China Forecasts 380 GW New Solar PV Installations In 2025.
The government is making efforts to change solar market design away from feed-in tariffs and create new demand through renewable energy auctions under the pricing reforms. However, the inaugural auction concluded by Shandong province is not convincing enough, given the low volumes it attracted. Only close to 5 GW was awarded across wind and solar technologies to come online by December 31, 2025 (see China Holds First Renewable Energy Auction Under New Reforms).
A factor leading to a year-end revival in growth could be the rush to complete projects before the end of China’s 14th Five-Year Plan by December 2025, before the 15th Five-Year Plan comes into effect next year. Any movement here could be expected following the Oct. 1 holiday week.
China recently announced a new commitment to achieve a combined 3.6 TW wind and solar installation by 2035. Although things are not looking up at present, the market has huge potential to exceed this number. At the end of August 2025 alone, China had achieved 1.7 TW, comprising 1.12 TW of solar PV (representing a 48.5% annual increase), and 580 GW of wind energy (representing a 22.1% YoY jump).
Estimating it could reach 1.8 TW solar and wind capacity till the end of this year, achieving the 3.6 TW target would require around 212 GW AC of solar and wind installations annually. Assumed this includes a 2/3rd share of solar, this would result in 150 GW AC of solar from 2026, which is way less than its potential as forecast by leading market analysts (see China Announces 3.6 TW AC Solar & Wind Target For 2035).
