China’s Solar Industry Slows Down Due to Industry Pressures

China's solar boom is cooling off after years of breakneck growth. The country added about 72 gigawatts of new solar capacity in the first half of 2026, a sharp slowdown from the record 315 gigawatts added in all of 2025. Part of the reason is a rush last year to finish projects before China's fixed feed-in-tariff program expired. Since then, new solar projects have had to sell power on market-based pricing instead of guaranteed rates, which changes the economics for developers and rewards projects sited where the grid can actually absorb the power.

Behind the slowdown, China's solar and wind fleets together now make up nearly half the country's total power generating capacity, and battery storage has grown fast, up 61% year-over-year, to help handle all that variable output. Chinese manufacturers still dominate global solar panel and component production, though exports dipped this spring after the government removed a tax rebate on solar exports, aimed at easing overcapacity and trade tensions.

None of this changes pricing or availability of solar panels for a homeowner right now, but it is worth watching. China makes the vast majority of the world's solar panels and components, so shifts in its manufacturing costs, export policy, and technology (efficiency gains in panel types like TOPCon and heterojunction cells) tend to ripple into panel prices and equipment options in other countries over time, including the U.S.