Exawatt expects China’s PV installations in 2026 to fall below both 2025 and 2024, raising the risk of a weaker global market
Overcapacity across the value chain and limited capacity exits continue to keep prices under pressure
TOPCon’s rapid efficiency gains are narrowing the space for BC to establish a clear advantage
The global solar industry is entering a more uncertain phase after several years of rapid expansion. Persistent overcapacity, weak pricing, and continued pressure on manufacturer profitability are reshaping the market outlook, even as competition between leading cell and module technologies continues to intensify.
During the TaiyangNews High-Efficiency Solar Technologies Conference 2025, Alex Barrows, Head of PV, CRU/Exawatt, presented a broader view of the sector covering PV demand, costs, prices, and technology direction. His presentation, titled ‘PV Demand, Cost, Price & Technology Outlook’, looked at the current market, the status of solar technologies, and the industry outlook.
Barrows said the past 2 years have been especially tough for PV manufacturers, particularly in China. Financial pressure has persisted since late 2023, with losses stretching through much of 2025. Although polysilicon prices and some other upstream prices rose temporarily, the increase was not supported by stronger fundamentals. Inventory remains high across polysilicon and modules, while overcapacity continues across the entire value chain. In his assessment, limited price recovery was driven more by policy signals and sentiment than by any real tightening in supply and demand.
A major part of the market outlook now depends on China’s transition to a CfD-style mechanism for solar power procurement. Under the new system, developers can bid for fixed prices, though they may also sell on the spot market, self-consume, or sign PPAs. Barrows noted that the first auction results appeared negative, with some prices reportedly 40% to 45% below earlier benchmark levels. However, more recent results have looked less severe. Based on a weighted average of auction outcomes announced so far, fixed prices under the new mechanism are around 13% lower than under the old system.
Even so, uncertainty remains high. Auction volumes are limited, several important provinces have yet to announce results, and developer response is still unclear. Monthly installations in China have already reflected this disruption. Between June and October, installations were down by close to 50% year-on-year. Barrows described this as a temporary low point caused by the gap between the end of the old regime and the rollout of the new one. He expects some recovery as the new system becomes established, but not enough to restore China to its previous highs.
Exawatt expects China’s PV installations to be lower in 2026 than in the previous 2 years. Europe and the US are also seen staying broadly flat, while growth in India, Colombia, and parts of the Middle East would only partly offset the decline. Barrows put global installations at around 670 GW in 2025 and projected 610 GW to 690 GW for 2026.
The current price levels are not sustainable for manufacturers in the long term, but there is still little evidence of an imminent rebound based on market fundamentals alone. Excess capacity remains at every stage of the chain. He said the industry still has roughly 2 to 3 times as much manufacturing capacity as needed in ingots, wafers, cells, and modules. Despite this, capacity exits have been limited. That has been one of the biggest surprises over the last 18 months.
Taking this as the backdrop, Barrows outlined 2 possible pricing scenarios. In the first, prices remain low because weak demand and overcapacity continue to dominate. In the second, Chinese policy intervention pushes prices upward. The latter could include stronger enforcement against below-cost selling, support for industry consolidation, or measures such as removing the remaining 9% VAT rebate for exports. However, he stressed that meaningful intervention has so far remained largely at the level of discussion. The longer that continues without concrete action, a sharp price recovery is less likely.
On technology, Barrows compared the current standing of PERC, TOPCon, HJT, and BC modules using Exawatt’s quarterly module tracker. PERC, he said, is now clearly behind the leading n-type options. TOPCon and HJT continue to show broadly similar average efficiencies, though TOPCon has recently moved ahead on maximum efficiency. One of the most notable developments is the emergence of TOPCon module datasheets showing efficiencies as high as 24.8%. Barrows pointed to recent launches and announcements from leading solar module manufacturers as evidence that TOPCon is still improving rapidly.
He said these latest TOPCon products appear to incorporate several of the features highlighted during the TaiyangNews conference, including rear-side poly-fingers, edge passivation-related approaches, and multi-cut cell designs. Besides higher efficiency, such products also claim stronger bifaciality and improved temperature coefficients. This means 2026 will be an important year to watch not only how quickly such modules reach commercial volumes, but also how widely other manufacturers can replicate similar performance levels.
That progress also complicates the position of BC technology. Barrows said this technology is still likely to remain the efficiency leader overall, especially in terms of average product performance. However, the narrowing of the peak efficiency gap makes it harder to justify the additional cost. In his view, BC would likely need to maintain an efficiency advantage of around 1% to 1.5% absolute over TOPCon to support a major cost-per-watt crossover and trigger a broad market transition.
According to Exawatt’s modeling, BC technology could come closer to TOPCon in cost per watt by 2028 to 2030. Barrows compared this with the earlier stage when TOPCon was narrowing the cost gap with PERC. However, a similar transition is not yet certain. Instead, the market could evolve in a way that allows both technologies to coexist, with BC gaining more traction in residential applications and TOPCon remaining stronger in utility-scale projects.
Capacity plans continue to support TOPCon’s dominance. Known manufacturing expansions remain overwhelmingly concentrated in TOPCon, and there is no sign of that changing in the near term. Still, Barrows noted more subtle indicators of growing BC interest. These include more pilot lines, more BC products shown at exhibitions, and increasing small-scale orders for BC-related materials. Together, these suggest that a wider transition is being explored, even if it has not yet reached industrial scale.
In closing, Barrows identified 3 key themes for the coming year: softer demand in China, uncertainty over pricing, and a tighter technology race between TOPCon and BC. His presentation suggested that market conditions are likely to remain challenging, even as technology development continues.
To access Exawatt’s full presentation video, click here.
