Energy Insider: China’s ‘Under Deployment’ of Solar Manufacturing Capacity, Beijing Vows to Be ‘Fully Prepared’ for Summer Power Demand

In this week’s Caixin energy wrap, key climate and energy-related updates in China include significant insights into solar capacity utilization, offshore wind leadership, summer power supply readiness, electric vehicle (EV) export projections, and nuclear power advancements. [para. 1]

A recent report by Ember, a London-based think tank, claims that the world’s solar manufacturing capacity, mainly based in China, is underutilized. The report argues this spare capacity could help achieve the global goal of tripling renewable power capacity by 2030 and improve electricity access in developing countries. Richard Black from Ember suggests viewing the issue as "under-deployment" rather than overcapacity, considering the benefits solar power brings and governments’ climate commitments. [para. 3][para. 4][para. 6]

China continues to lead in offshore wind power development for the sixth consecutive year, having installed 6.3 gigawatts (GW) of capacity in 2023. According to the Global Wind Energy Council (GWEC), China’s total offshore wind capacity now stands at 38 GW, surpassing Europe by 11%. Despite slower growth after national-level subsidies were cut off in early 2022, China’s offshore wind capacity is projected to double by 2025, increasing from 30.5 GW at the end of 2022 to over 60 GW. [para. 8][para. 10][para. 11]

Amid expectations of an unusually hot summer, the National Development and Reform Commission (NDRC) assures that the Chinese government is fully prepared to meet energy demand. Power generation rose by 5.5% year-on-year from January to May 2023, whereas demand surged by 8.6%. However, power supply may be tight during peak hours in some regions, especially due to extreme weather events and high air-conditioning demand, as warned by the National Energy Administration in April. [para. 13][para. 15][para. 16]

Despite backlash from the European Union and the U.S. against Chinese-made electric vehicles (EVs), China's auto exporters are optimistic about continued global expansion. In 2023, China became the world’s largest auto exporter, shipping 4.91 million cars. Xu Changming from the State Information Center expects this momentum to continue, projecting that Chinese automakers will sell up to 20 million cars overseas by 2035, including exports and locally produced vehicles in overseas Chinese facilities. This comes as the EU plans to impose extra tariffs on Chinese battery-electric vehicles starting July 4, amid an investigation into state subsidies. [para. 18][para. 19][para. 21]

Lastly, an analysis by the Information Technology and Innovation Foundation reveals that China is 10 to 15 years ahead of the U.S. in deploying fourth-generation nuclear reactors. China’s strategic focus on building domestic nuclear reactors is seen as a key advantage. Most nuclear projects in China use the domestically developed third-generation Hualong One reactor technology. Notably, the world’s first fourth-generation nuclear plant began commercial operation in December in Shandong province. This technology promises greater safety, fuel efficiency, and minimal long-lived radioactive waste. [para. 23][para. 24][para. 26]

In summary, China's renewable energy sectors, from solar to wind and nuclear, are marking significant progress despite facing challenges such as high demand and international trade friction. These developments position China as a critical player in the global energy transition landscape. For further inquiries, contact editor Jonathan Breen. [para. 28]