The recent electricity pricing policy has significantly reshaped the investment logic in the new energy sector, leading to the termination of the largest photovoltaic module procurement in China’s history by China Electric Construction Group.
On April 9, China Electric Construction Group Co., Ltd. announced the cancellation of the 2025 Annual Photovoltaic Module Framework Procurement Project due to changes in procurement needs stemming from recent adjustments in new energy electricity pricing policies. Bidders are advised to contact the bidding agency to process the refund of their bid guarantees.
Since the initiation of the tender, this procurement project has garnered considerable attention within the industry. The public tender for the 2025 photovoltaic modules and inverters was launched on November 13, with a procurement scale of 51 GW for both modules and inverters. This scale not only marks a historical high but also serves as a significant price benchmark amidst the industry’s self-regulated production limits and price caps.
The procurement was divided into three segments, with 58 module companies participating in an unprecedentedly competitive bidding process. Many bids fell below the minimum price limit of 0.68 yuan/watt set by the photovoltaic industry association, which delayed the announcement of the winning candidates. In contrast, the inverter procurement initiated at the same time had already announced its winning candidates at the beginning of the year.
During this period, the environment for the photovoltaic industry underwent dramatic changes. On February 9, the National Development and Reform Commission and the National Energy Administration released a significant notice regarding the deepening of market-oriented reforms in new energy electricity pricing. This document, referred to as Document 136, proposes a transition to a pricing system that differentiates between existing and new projects, effective from June 1, 2025.
The introduction of Document 136 signifies the end of the era of “fixed electricity prices,” moving away from guaranteed returns and government-set prices, thus exposing the sector to the volatility of the electricity market. This transition has been described as a “rite of passage” for new energy. For investors in this sector, traditional profitability models have become obsolete, and the complexity of investment logic has increased substantially. During this transitional period, many details await further clarification from local policies, leading to heightened caution among investors.
According to industry reports, under the new policy, state-owned enterprises are grappling with questions regarding how to assess future new energy projects and what standards to use for investment decisions. Consequently, many projects have been put on hold, triggering a chain reaction. Some private companies have expressed concerns that projects with contracts secured prior to June 1 that cannot be grid-connected will need to renegotiate under the new policy, as the return rates remain unclear, preparing for the possibility of being unable to trade these projects in the short term.
For state-owned developers, discussions with local governments about industrial support and associated costs have also been put on hold, awaiting the results of new project assessments before making further decisions.
Additionally, photovoltaic module prices have experienced significant fluctuations, with the procurement by state-owned enterprises slowing down due to rising component prices. Influenced by Document 136 and the management measures for distributed photovoltaic power generation, the industry saw a brief surge in demand during a downturn, pushing prices up the supply chain. However, given the current supply-demand dynamics, sustained price increases seem unlikely, and as the policy switch approaches, the consensus within the industry is that photovoltaic prices are likely to trend downward.
