China’s Solar Boom Faces Grid Bottlenecks as Curtailment Hits Record

• Solar curtailment in China jumped to 5.7 % in H1 2025 despite record 277 GW installs, exposing grid and storage shortfalls in western provinces.

China’s runaway solar expansion is colliding with the hard limits of its power network. New National Energy Administration (NEA) data show solar curtailment surged to 5.7 % in the first half of 2025, almost double the 3 % recorded a year earlier. The jump comes even as the country added a mind-bending 277 GW of new PV in 2024—more than the total capacity installed by any other nation to date—and is on track for a further 200-plus GW this year.

Curtailment—electricity generated but dumped for lack of demand or transmission—has spiked in the sparsely populated interior, with Tibet, Xinjiang and Qinghai regularly breaching the government’s new 10 % tolerance threshold. Analysts warn that wastage at this level could erode project returns, chilling investment sentiment even before Beijing’s 1,200-GW-by-2030 goal is met. The State Grid Corporation is hurrying to close the gap, pledging a record ¥650 billion (US$90 billion) capex this year on ultra-high-voltage (UHV) lines and digital substations, yet most links take five years to build.

Storage is lagging too. Although China commissioned 22 GW/46 GWh of batteries last year, that covers barely one-tenth of daily solar peaks. “Generation is out-running both wires and wires-plus-storage,” says Fitch analyst Diana Xia, who predicts curtailment will stay elevated until at least 2027. Some provinces are pivoting to co-locating data centres or electrolyser clusters to soak up midday surplus, but those industrial loads remain on the drawing board.

Even so, Beijing shows no sign of hitting the brakes. May alone saw more PV added than the United States managed during all of 2024, underscoring domestic manufacturers’ grip on the global supply chain. Developers shrug off short-term slips, betting that UHV lines and market reforms will unlock coastal demand. Yet rising curtailment could squeeze margins: spot power prices in western hubs have tumbled 40 % since January as oversupply meets limited local consumption.

The coming two summers will be decisive. If grid upgrades fail to keep pace, China’s solar gold rush may find itself energy-rich but revenue-poor—a cautionary tale for any country sprinting ahead of its wires.