Follow India Renewable Energy News on WhatsApp for exclusive updates on clean energy news and insights

China’s Market Watchdog Moves to Rein in Cut-Throat Pricing in Solar Industry

China’s State Administration for Market Regulation (SAMR) has issued fresh compliance guidance aimed at restoring order in the country’s solar photovoltaic (PV) market, as intense price-based competition continues to strain industry profitability.

The guidance was delivered during a meeting held in Hefei, Anhui Province, where SAMR officials outlined key pricing violations and risk areas affecting the PV sector. The regulator highlighted that low-quality competition, coupled with uniform and repetitive capacity expansion, has created significant financial stress across the industry.

According to SAMR, these market distortions have undermined efficient resource allocation while discouraging investment in technological advancement and product enhancement, ultimately weakening the sector’s long-term sustainability.

The regulator stressed that industry participants must acknowledge the urgency of addressing what it described as “involution-style” competition. Solar manufacturers and developers were instructed to align production and commercial activities strictly with existing laws and regulations. Practices such as price collusion, deceptive pricing, and other forms of improper price manipulation were explicitly prohibited.

SAMR also called for the elimination of unfair competitive behavior, including misleading advertising and commercial bribery. Power generation companies were urged to uphold fair pricing and high-quality standards in PV project tenders, alongside stricter quality requirements for equipment and components.

Industry bodies were encouraged to strengthen self-regulatory mechanisms, guiding companies toward cooperative growth through innovation, quality improvement, and enhanced services, while helping build a more balanced and sustainable industry ecosystem.

The regulator confirmed that it will step up oversight of product quality, intensify enforcement against pricing violations and unfair competition, and take strict action against illegal practices to ensure a level playing field and promote the orderly development of the PV industry.

The meeting was attended by representatives from SAMR, the National Development and Reform Commission, the Ministry of Industry and Information Technology, and the Ministry of Commerce, along with officials from provincial market regulation authorities in Jiangsu, Zhejiang, Anhui, and Qinghai. Industry associations, power generators, and solar companies were also present.

The move comes amid ongoing trade tensions. Recently, China lodged a complaint with the World Trade Organization (WTO) challenging India’s solar subsidy policies, arguing that they distort competition. The two countries have repeatedly taken clean energy trade disputes to the WTO, including a 2023 challenge by China to India’s Approved List of Models and Manufacturers (ALMM) requirement mandating the use of domestically manufactured solar modules.