China intends to tighten export restrictions on 12 technologies used in the production of solar equipment, citing national security concerns. This move is part of a broader review that also encompasses artificial intelligence and biotechnology, Reuters reports.
The Ministry of Commerce has proposed adding photovoltaic technologies to China’s export control list, stating that stricter oversight is required because technologies from the solar energy sector are increasingly being utilized in sensitive areas, such as aerospace and national defense.
In April, Reuters reported that officials in Beijing were discussing potential restrictions on advanced photovoltaic technologies with manufacturers—a decision that could impact the plans of American firms, such as Tesla, to expand their production within the United States, according to Agerpres.
Furthermore, China has also restricted the export of solar energy technologies to India, Reuters noted. Analysts suggest that China is seeking to maintain its dominance, even as India aims to reduce its reliance on China by boosting domestic production.
Export controls are intended “to prevent the risk of technologies spiraling out of control or being disseminated inappropriately, while ensuring normal international exchanges and cooperation in science and technology,” the Ministry of Commerce stated.
Exporters are now required to register certain outbound technology transfers pending an update to China’s export control list. Furthermore, China will restrict—though not outright ban—exports of advanced solar cell manufacturing technology, including TOPCon, HJT, and XBC.
Shares in Chinese renewable energy equipment manufacturers surged by more than 10%, reaching a five-year high, following the onset of US-Israeli attacks on Iran on February 28.
The conflict has pushed oil prices above $100 per barrel and poses a threat to the global economy, compelling many governments to re-evaluate the role of fossil fuels in their energy mix. However, while markets are betting that this could boost demand for photovoltaic panels and other green energy production equipment from China, Chinese manufacturers themselves are less optimistic.
The photovoltaic industry is considered one of the sectors most severely affected by overcapacity—a chronic issue within the Chinese economy that has fueled a record trade surplus while eroding manufacturers’ profits and stoking diplomatic tensions.
“Prices might rise slightly, or global demand could see a small uptick, but this won’t have any significant impact on the overall supply-demand dynamic,” an executive in the Chinese photovoltaic industry recently stated, speaking on condition of anonymity. “The problem is that the capacity is still there. It hasn’t been shut down, cleared out, or truly removed from the market,” the source added.