In 2024, China emerged as the world’s leading investor in research and development (R&D), accounting for 27.4% of total spending, up from just 4% in 2000. This momentum has enabled China to consolidate its position as a global leader in a growing number of “critical technologies, ” particularly in the photovoltaic solar panel sector, where it accounts for 80% of global production.

Thanks to a forward-looking strategy and strong, effective government involvement, China has moved far beyond its role as the “world’s factory” to become the industrial, technological, and scientific leader in the solar photovoltaic (PV) sector.

The challenge for Europe and the United States now is to avoid falling so far behind in the race for innovation that the gap becomes insurmountable, particularly in this sector, which is key to decarbonizing our economies.

Global dominance in production

It took China no more than ten years to literally oust the three major players of the late 20th century—Europe, the United States, and Japan—from the solar panel market. In 2002, these three players held a combined global market share of about 80 percent, while China’s share was negligible. By 2012, the trend had already reversed, with China holding 70% of the market and the three former solar powerhouses holding less than 10%.

Since then, China's position has grown even stronger across all segments of the value chain.

With unquestionable expertise in mass production, the company focused during the 2000s on developing its industrial capabilities in high-potential segments (wafers, cells, and modules); then, in the 2010s, on the silicon sector—where its reliance on foreign sources was initially the greatest—by facilitating foreign technology transfers and drawing on massive public support.

As a result, Chinese companies are now making inroads across all five segments of the value chain: silicon, ingots, wafers, cells, and panels.

This industrial position initially allowed it to focus on Western demand, but the decline in subsidies in those markets after 2010 prompted the Chinese government to boost domestic demand growth through strong, targeted public interventions—notably through its planning system and, starting in 2015, an electricity market reform that strongly favored renewable energy.

In the mid-2010s, however, significant production overcapacity led Chinese government authorities to encourage domestic firms to expand their international markets toward developing countries, particularly emerging markets, including the African continent. It is important to note that this new strategy proved successful thanks to a drastic drop in the cost per kilowatt-hour of photovoltaic power.

By making this energy available to developing countries to meet their immense energy needs, China has strengthened its image as a responsible power.

Through its ability to meet domestic and global demand for solar panels, China is contributing to the energy transition and the decarbonization of the electricity sector. In 2024, China’s installed capacity reached 1,048.5 gigawatts-peak, accounting for 46.7% of the world’s total installed capacity (a watt-peak refers to the rated power of a photovoltaic system under optimal sunlight and temperature conditions).

However, questions remain about China’s ability to become a leader in cutting-edge technologies. Is it still the “world’s factory” in photovoltaics, as in other sectors, or has it now developed the capacity to position itself at the forefront of research and innovation?

China has become a technological leader

There are four distinct categories of solar photovoltaic technologies, depending on the materials used:

• crystalline silicon, which alone will account for more than 97% of the total market in 2024, with an energy conversion efficiency exceeding 20% for commercial solar modules;

• thin-film technologies—primarily based on cadmium telluride (CdTe), copper, indium, gallium, and selenium (CIGS), or amorphous silicon—which will account for 2.2% of the total market in 2024, with lower efficiency and more specialized applications paving the way for flexible, lightweight solar modules that perform well under low-light conditions;

• "emerging" dye-sensitized cells based on hybrid perovskite and organic cells: none are yet widely available on the market; however, they hold promise for reducing the environmental impact of solar power generation;

• Multijunction cells, which are highly efficient but still very expensive, are often reserved for military and space applications.

In these four categories, China leads both quantitatively and qualitatively in patent applications. Between 1990 and 2022, 40% of patented inventions—out of a total of 57,000—were Chinese. Innovation efforts, in China as elsewhere, are focused on emerging cell technologies (just over 28,000 patents, of which about 40% are from China), followed by first-generation conventional crystalline silicon solar cells, or c-Si (nearly 20,000, of which about 50% are from China).

Furthermore, China leads in patent citations for c-Si and emerging solar cells: it ranks among the top 10% (the threshold for “major” inventions) and the top 1% (the threshold for “disruptive” innovations).

China’s rapid and sustained growth in patents related to technologies already in industrial use suggests that “learning by doing” has been the main driver behind the establishment of China’s preeminence.

The photovoltaic sector is, in fact, one in which the learning curve (the decrease in cost for every doubling of capacity at a given technology level) is recognized as among the highest (20 to 30 percent, according to an estimate by the International Energy Agency, 2020) and is therefore among the sectors most conducive to economies of scale and increased competitiveness for companies and countries that focus on technologies they have mastered.

China's dominance is also becoming increasingly evident in emerging technologies

China is thus establishing itself as the world's leading scientific hub for next-generation solar research.

A bibliometric analysis of scientific output in peer-reviewed journals in the most cutting-edge fields—namely, emerging solar cells—provides insight into the effectiveness and sustainability of China’s scientific prowess. Indeed, these technologies have the potential to break the current near-monopoly of crystalline silicon, due to their promise of higher energy efficiency, lower production costs, and reduced environmental impact through energy-efficient deposition processes and large-area printing.

Thus, in 2023, China accounted for more than 50% of scientific output on hybrid perovskites (the most dynamic emerging technology since 2012) and 55% for organic photovoltaics. Dye-sensitized solar cells have been experiencing a relative decline since 2014. China had reached a peak in publications in this field before being surpassed by India in 2021—a decline primarily attributable to the shift of research efforts toward hybrid perovskites.

In the field of photovoltaics, as in others, it is not out of place to speak of a “Chinese shock.”

In 2018, the U.S. administration adopted the China Initiative, whose stated goal was to combat scientific and industrial espionage by restricting scientific collaborations with Chinese researchers. However, the main effect of this attempt to isolate Chinese research has been a shift in collaborations toward partners other than the United States—particularly South Korea and Germany— allowing for the continued growth of Chinese scientific output, in contrast to that of the United States, which has been declining since then.

What's more, a growing proportion of the most-cited publications in the most prestigious journals are now produced by all-Chinese teams, without international collaboration, confirming China's growing scientific autonomy.

The project “Energy Transition in China: New Economic and Policy Directions – TEChNOPE” (ANR-18-CE05-0011) is supported by the French National Research Agency (ANR), which funds project-based research in France. The ANR’s mission is to support and promote the development of basic and applied research across all disciplines and to strengthen the dialogue between science and society. For more information, visit theANR website..