China renewable capacity growth to slow in 2025

This year’s level will remain above the 2023 record as more projects come online.

The expansion of China’s renewable energy capacity is projected to fall from the record high of 358 gigawatts (GW) in 2024, according to Fitch Ratings.

In its analysis, Fitch said this was due to tighter distributed solar policies and stressed returns. Still, this year’s additions will remain above the 2023 level as more energy base projects are commissioned.

“The rollout of a power-tariff-difference settlement mechanism from June 2025 may bring upside to capacity additions in 5M25, as developers speed up installations to lock in more visible returns,” it added.

Fitch also expects milder power demand growth, rapid renewable capacity expansion, and lower grid-offtake hours may continue to cut utilisation hours in 2025 until grid and storage capability strengthens materially.

“We expect demand growth to fall from 6.8% in 2024 on ongoing property-sector challenges, weaker exports amidst US tariff hikes and warmer weather, but to still outpace our GDP growth forecast of 4.3%, driven by rising artificial intelligence penetration and electrification,” it noted.