China increases grid spending for solar power integration

China is increasing investment in its power grids to handle more electricity from solar energy. Spending on the power network rose by around 33% in the first two months of this year. This increase is more than double the average from 2024. The National Energy Administration reports that total investment reached 43.6 billion yuan, or about $6 billion. Although spending is rising, it is still short of the target needed for the year. The two main state-owned utility companies want to spend 820 billion yuan in total. China is expected to continue leading the world in solar power development this year, contributing to over half of the global total, according to BloombergNEF. However, China has faced challenges in integrating all the new solar power into its electricity grid. This has led to restrictions on how much solar energy can be used. To fix this issue, investments are being increased through State Grid Corp. of China and China Southern Power Grid Co. In the first two months of the year, solar energy installations grew by nearly 43%, which is lower than the 57% growth seen during the same period last year. Solar power made up about 75% of all new power capacity, while other sources like thermal and wind energy saw declines. Developers are working quickly to connect rooftop solar projects before May 31. A new power trading program starting then may make competition in the solar sector even tougher. Industry forecasts predict that new solar installations could decline to as low as 215 gigawatts this year, down from last year’s record of 277 gigawatts.