China to scale back clean energy subsidies after solar boom

China will reduce subsidies for new renewable energy projects after a surge in solar and wind installations, the National Development and Reform Commission (NDRC) said on Sunday.

The country added a record 45 per cent more solar capacity in 2024, bringing total installed capacity to 887 GW—over six times that of the United States, according to the International Renewable Energy Agency.

The rapid expansion allowed China to meet its 2030 clean energy target six years early, while the US, under President Donald Trump, exited the Paris Agreement again and pushed for increased fossil fuel production.

The NDRC said the falling costs of clean energy made subsidies less necessary. From June, new projects will sell electricity through market-based bidding instead of guaranteed prices. The agency expects no major impact on consumer electricity rates but did not disclose specific pricing details.

Reduced subsidies could pressure China’s solar industry, where overcapacity has driven panel prices down, threatening smaller manufacturers with bankruptcy. The NDRC pledged to coordinate with local governments to implement the policy shift.

Attribution: Reuters

Subediting: Y.Yasser