BEIJING: China’s government released a draft regulation to limit expansions in its world-leading solar industry, as domestic companies struggle with losses amid oversupply and fierce competition.
Authorities will curb new manufacturing projects that simply expand existing capacity, and direct companies to instead improve quality and bring down production costs, according to the draft rule released for public consultation on Tuesday by the Ministry of Industry and Information Technology.
Chinese solar manufacturers’ capacity outstripped demand in recent years, pushing prices to record lows and forcing many to sell below cost. Many have repeatedly called for government intervention to ease the glut.
The draft regulation also requires higher efficiency in products coming out of existing and new factories, and sets minimum requirements for research and development spending.