China added a record 60 GW of new solar capacity in the first quarter of 2025, with rooftop installations accounting for 36 GW – the highest quarterly total for distributed PV in the country’s history, according to Rystad Energy.
The surge came as developers rushed to meet deadlines tied to the National Energy Administration’s (NEA) updated guidelines, issued in October 2024 and effective this month. The new rules emphasize self-consumption to alleviate grid congestion and reduce dependence on centralized power plants. They also align with China’s dual carbon targets of peaking emissions by 2030 and achieving carbon neutrality by 2060.
Rystad Energy said it expects rooftop PV growth to continue into the second quarter, with distributed solar additions for the year forecast to reach 130 GW – comprising 92 GW of commercial and industrial (C&I) projects and 38 GW of residential. Utility-scale PV installations are expected to total 167 GW in 2025, driven by a robust project pipeline and provincial efforts to meet targets under China's 14th Five-Year Plan.
The NEA’s policy overhaul has ended full grid access for C&I projects. Installations up to 6 MW can self-consume and sell surplus power to the grid, but larger projects must fully use power onsite without grid sales.
“While these new guidelines are pushing China forward, they’re having a dual impact on the C&I sector that typically has limited or no grid connection. On one hand, increased self-consumption in C&I rooftop PV projects is easing grid-connection challenges and helping ease grid congestion across the country,” said Yicong Zhu, vice president of renewables and power research at Rystad Energy. “The rules are also helping to accelerate progress in carbon trading and green certificate markets, with storage installations expected to rise. However, the added complexity in purchase agreements may introduce new uncertainty and potentially weigh on project economics, which could dissuade developers, investors and financiers.”
Provincial responses to the guidelines vary. Inner Mongolia and Jilin imposed the country’s strictest self-consumption mandates – 90% and 80% respectively for projects up to 6 MW – leading to minimal rooftop C&I uptake in the first quarter. Inner Mongolia added just 82 MW of C&I capacity, with rooftop C&I representing under 4% of installed PV, while Jilin installed 40 MW, with rooftop systems making up 16% of total solar.
Jiangsu and Guangdong, China’s top two provinces for new PV installations, did not enforce self-consumption thresholds. Both provinces allow large C&I projects to either qualify for grid access or convert to utility-scale status post-approval.
In Shandong and Hubei, all excess power from C&I projects connected to the grid must now be traded on power markets, in line with the NEA’s push for market-based pricing of new renewable capacity.
