Solar PV vs Wind: Better Clean Energy Bet for Foreign Firms in China?

Solar PV vs Wind: Better Clean Energy Bet for Foreign Firms in China?

China added 216 GW of solar PV capacity and 76 GW of wind capacity in 2025 alone, making it the world’s largest clean energy market by a wide margin, according to data from the National Energy Administration (NEA). For foreign companies evaluating where to deploy capital in China’s renewable energy sector, the choice between solar photovoltaic (PV) and wind power is not merely technical — it involves fundamentally different market structures, supply chain dynamics, policy support regimes, and competitive landscapes.

This comparison examines solar PV and wind energy as investment opportunities for foreign firms in China, analyzing market size, growth trajectories, profitability, technology trends, regulatory barriers, and supply chain considerations. The analysis draws on 2024-2026 NEA data, industry reports, and the experiences of foreign-invested enterprises currently operating in each sub-sector.

Market Size and Growth Trajectory

China’s solar PV market has grown explosively, with cumulative installed capacity reaching 890 GW by end of 2025 — more than the total power generation capacity of the European Union. Wind power cumulative capacity stood at 520 GW over the same period. Both sectors continue to grow at double-digit rates, but the growth dynamics differ significantly.

Supply Chain: Where Foreign Firms Can Compete

China’s solar PV supply chain is one of the most vertically integrated and cost-competitive in the world. Chinese companies control over 80% of global polysilicon production, 97% of silicon wafer manufacturing, and 85% of solar cell production. This makes it extremely difficult for foreign-invested manufacturing enterprises to compete at the commodity solar panel level, where gross margins have compressed to 8-12% for standard products.

Opportunity areas in solar PV for foreign firms: High-efficiency cell technologies (heterojunction, back-contact, perovskite-silicon tandem cells), solar mounting and tracking systems, building-integrated photovoltaics (BIPV), solar-plus-storage integrated solutions, and specialized inverters for utility-scale applications. These niches reward technological differentiation over cost leadership.

Wind power manufacturing is similarly concentrated, with Goldwind, Envision, and Mingyang controlling the domestic turbine market. However, the offshore wind segment has been more open to foreign participation, particularly in foundation engineering, subsea cabling, and operations & maintenance services. Foreign firms with proven offshore wind expertise from Europe have found ready demand among Chinese developers building large-scale offshore projects in Fujian, Guangdong, and Shandong waters.

Policy Support and Subsidy Regimes

Both solar and wind benefit from China’s commitment to reach peak carbon emissions by 2030 and carbon neutrality by 2060. However, the policy support mechanisms differ:

1. Solar PV: Feed-in premiums — Since the phase-out of national FITs in 2021, solar projects compete in provincial benchmark auctions. Prices have fallen to RMB 0.25-0.35/kWh, with provincial governments offering one-time capacity subsidies of RMB 50-200/kW for distributed solar
2. Onshore wind: Grid parity — Onshore wind reached grid parity in most regions by 2023. Provincial governments offer land use tax reductions and accelerated permitting for wind projects in designated “clean energy bases” (e.g., Gansu, Inner Mongolia, Xinjiang)
3. Offshore wind: Provincial subsidies — Several coastal provinces (Guangdong, Zhejiang, Shandong) offer top-up subsidies of RMB 0.05-0.20/kWh to bridge the gap between offshore wind LCOE and the provincial coal benchmark price
4. Energy storage mandates — Both solar and wind projects are increasingly required to co-locate energy storage (typically 10-20% of installed capacity), which affects project economics
5. Green certificate trading — Both solar and wind projects can generate tradable green certificates (GECs), providing an additional revenue stream of approximately RMB 30-50/MWh

Policy disparity between solar and wind: A critical difference is that solar PV benefits from distributed generation policies — residential and commercial rooftop solar systems receive faster permitting and priority grid connection under the 2024 Distributed Solar Development Guidelines. Wind power, by contrast, is overwhelmingly utility-scale and must navigate more complex land use and environmental impact assessment procedures. For foreign firms exploring smaller-scale investments, the distributed solar pathway offers significantly lower barriers to entry. According to the NEA’s 2025 annual report, over 45% of new solar capacity additions in 2025 were distributed systems (under 6 MW), compared to less than 3% of new wind capacity being small-scale. This structural difference means foreign investors can enter the solar market at a much smaller investment threshold — as low as USD 500,000 for a commercial rooftop installation — while wind investment typically requires USD 50 million or more per project.

Competitive Landscape: Who Are the Incumbents?

Foreign firm case study: Dutch solar technology company in China. A Netherlands-based manufacturer of specialized solar inverters entered the Chinese market in 2023 through a technology licensing arrangement with a mid-tier Chinese inverter producer. Rather than competing head-on with Chinese giants like Huawei and Sungrow in the utility-scale inverter segment, the Dutch company focused on a niche: inverters optimized for agrivoltaic (solar-plus-agriculture) applications, a rapidly growing segment in China driven by the government’s “complementary agriculture-solar” policy. By licensing its proprietary maximum power point tracking algorithm specifically for partially-shaded conditions — common in agrivoltaic installations where crops or livestock share land with solar panels — the Dutch company achieved 18% higher energy yield in agrivoltaic applications compared to standard inverters. The licensing arrangement generated RMB 12 million in royalty revenue in its first two years, and the Dutch company retained full ownership of its core IP with no technology transfer to the Chinese partner beyond the licensed application.

Foreign firms face intense domestic competition in both sub-sectors. In solar PV manufacturing, the top five Chinese firms (LONGi, Tongwei, JA Solar, Trina Solar, JinkoSolar) control over 60% of global production capacity. Their scale advantages in procurement, manufacturing automation, and supply chain logistics create formidable barriers for new entrants.

Wind power is somewhat more fragmented, with the top five Chinese turbine manufacturers holding approximately 55% of the domestic market. Foreign turbine manufacturers like Vestas, Siemens Gamesa, and GE Renewable Energy have smaller market shares in China (collectively under 10% of onshore installations) but stronger positions in offshore wind, where their technology and project experience command a premium.

Technology Trends and Foreign Firm Positioning

Solar PV trends: Perovskite-silicon tandem cells are the next frontier, with Chinese manufacturers targeting commercial production by 2027-2028. Foreign firms with proprietary perovskite technology may find licensing opportunities with Chinese manufacturers. BIPV is another growth area, driven by China’s green building standards that now require solar-ready roofs on all new public buildings. The Ministry of Housing and Urban-Rural Development’s 2025 Green Building Action Plan mandates that all new public buildings above 2,000 square meters must incorporate solar-ready roof designs, creating a addressable market for BIPV products of approximately 800 million square meters of roof space by 2030. Foreign companies with proven BIPV products — such as solar roof tiles and semi-transparent photovoltaic glazing — are well-positioned to capture a share of this market through distribution partnerships with Chinese construction material suppliers.

Wind trends: Turbine sizes are scaling rapidly — the average offshore wind turbine installed in China in 2025 was 12 MW, with 15-18 MW turbines entering production. Foreign firms with expertise in large-turbine design, advanced blade materials, and floating offshore wind technology have clear differentiation opportunities.

Risk Assessment by Sub-Sector

Which Sub-Sector Fits Your Foreign Firm Best?

Choose solar PV if: Your company has proprietary technology in high-efficiency cells, BIPV, or solar-plus-storage integration; you are comfortable competing on technology differentiation rather than scale; you want to supply into China’s distributed solar boom (residential and commercial rooftop); or you have expertise in solar recycling or circular economy solutions.

Choose wind power if: Your company has proven offshore wind project development experience; you manufacture components where foreign expertise commands a premium (foundations, subsea cables, O&M services); you want to participate in China’s floating offshore wind demonstration projects; or you are looking for longer-term, large-scale investment with stable regulatory frameworks.

Where to Go From Here

Based on what you just read:

• Ready to act? Read a step-by-step guide to entering China’s solar PV manufacturing sector
• Still comparing? See a detailed comparison of China wind energy investment models
• Need numbers? Try an interactive ROI calculator for solar vs wind investment in China

Solar PV vs Wind: Better Clean Energy Bet for Foreign Firms in China? — first published on China Gateway 360. Last updated: July 2026.