Beijing, September 2, 2026 - China's energy development has reached a historic turning point. According to the latest data released by the National Energy Administration on September 1, as of the end of July 2026, China's installed photovoltaic (PV) power capacity reached 1,286 gigawatts (GW), surpassing coal-fired power capacity of 1,285 GW for the first time. This milestone marks the official ascendancy of solar PV as the largest power source in China's installed capacity mix.
When it comes to composition, utility-centralized PV amounts to 704 GW out of total PV capacity of 1,286 GW, while distributed PV constitutes 582 GW. Additionally, despite the total generating capacity being 4,080 GW, PV accounts for 31.5% of the power generation. Between January and July this year, more than 40% of the new generation capacity installed in the country was from PV.
Three Steps, Three Leaps
This achievement followed a clear stepwise progression:
End of June 2023: China's renewable energy installed capacity surpassed coal power for the first time.
2025: The combined installed capacity of wind and solar power historically exceeded thermal power. By the end of 2025, solar power installed capacity had reached 1.20 TW, a year-on-year increase of 35.4%.
End of July 2026: Photovoltaic installed capacity alone surpassed coal power.
This trajectory has rewritten the power supply structure that had been dominated by coal for over a century in China's electricity industry.
World-Leading Industrial Strength
China has built the world's most complete and most competitive photovoltaic industrial chain. Chinese PV module production accounts for approximately 80% of the global total, while production capacity for polysilicon, wafers, and cells each accounts for over 90% globally. During the 14th Five-Year Plan period, PV conversion efficiency repeatedly broke world records.
On the application side, more than 8.3 million households nationwide have become owners of distributed PV systems. In the northwestern "desert, gobi, and wasteland" regions, PV arrays have not only generated power but also helped control desertification across 2.3 million mu (approximately 153,000 hectares) of land.
Installed Capacity ≠ Generated Electricity
It should be noted that installed capacity does not equate to actual electricity generation. Due to the constraints of day-night cycles and weather conditions, PV's utilization hours remain far lower than those of coal power. From January to July this year, PV generated 802.4 billion kWh, accounting for 13% of total social electricity consumption. In the first half of 2026, coal power's share of electricity generation, although historically dropping below 50%, still stood at 49.7%.
Liu Zhiqiang, Deputy Director of the Planning and Development Department at the China Electricity Council, stated: "In the short term, coal power remains China's primary supporting power source, playing a system-wide safety net role."
Cost Reductions Drive Structural Shift
The primary factor contributing to the rise of PV over coal in terms of installed capacity is the remarkable decrease in costs caused by technological advances. Currently, the cost of investment in PV equipment in China has reduced to less than RMB 2.5 per watt and the cost of modules has reduced to less than RMB 0.8 per watt. In areas where there is a lot of sunshine, the LCOE of PV is already less than RMB 0.25 per kWh, and in some southeastern provinces, it has been significantly lower than the local coal-based electricity prices. In the last 10 years, LCOE of PV has decreased by over 90%.
Challenges and Transition
The PV industry still faces cyclical adjustment pressures. In the first half of 2026, newly added PV installed capacity fell by approximately 66% year-on-year, while industrial chain product prices continued to decline and leading companies reported widespread losses. At the same time, coal power is accelerating its transformation from a baseline supply source to a supporting and regulating source, providing room for renewable energy integration through deep peak-shaving, while acting as a backup guarantee during nighttime and overcast periods.
China has indicated that within the framework of its 15th Five-Year Plan for Renewable Energy Development, it intends to achieve 6 trillion kWh per year in power generation by 2030, with wind and solar electricity generation exceeding 4 trillion kWh. A variety of models, including the hybridization of photovoltaics with storage solutions, solar pv-thermal installations, and hydrogen production via photovoltaics, will be promoted in China to drive the transition of solar power from a weather-dependent to a dispatchable and predictable power source.
