China , the undisputed leader in global photovoltaic manufacturing, is moving forward with a new strategy to reorganize a sector currently facing one of the most challenging periods in its recent history. The Ministry of Industry and Information Technology (MIIT) has launched a public consultation to establish new classification criteria for solar modules, raising the bar for efficiency, reliability, and sustainability for manufacturers.
The proposal is part of the draft national standard “Classification and classification of photovoltaic products, Part 1: Photovoltaic modules” , a framework that seeks to guide technological innovation and promote a clearer differentiation between products in an increasingly competitive market.
Among the main changes, the text incorporates new evaluation parameters based on five axes: climate adaptability, specific applications, reliability, photoelectric conversion efficiency and environmental attributes, including recyclability and carbon footprint.
One of the most important aspects is the creation of performance categories for modules based on their technology. The draft establishes minimum efficiency levels for the main photovoltaic architectures that currently dominate the industry.
For TOPCon modules (tunnel oxide passivated contact), the proposed efficiencies range from 22.4% to 23.6%, depending on the classification achieved. For heterojunction technology (HJT), the requirements are between 22.5% and 23.9%, while back-contact modules must achieve even higher levels, with efficiencies ranging from 23.3% to 24.8%.
The public consultation will remain open until July 12, 2026, and could become one of the most relevant regulatory initiatives for the Chinese photovoltaic industry in recent years.
A response to the overcapacity crisis
The decision comes at a particularly delicate time for the sector.
After years of accelerated expansion between 2020 and 2022, the Chinese photovoltaic industry continues to be trapped in a combination of oversupply, price collapse and financial deterioration that affects virtually the entire value chain, from polysilicon to finished modules.
The figures for the first quarter of 2026 reflect the magnitude of the adjustment. According to financial reports from leading companies and analyses published in China, 22 listed companies in the sector recorded combined revenues of 95.8 billion yuan, a drop of more than 11% compared to the same period of the previous year.
Even more worrying is the bottom line: adjusted net losses hovered around 13.1 billion yuan. Industry giants like Tongwei, LONGi, and TCL Zhonghuan have now posted losses for ten consecutive quarters, a sign that the crisis has ceased to be temporary and has become a structural problem.
The challenge is largely explained by the enormous installed capacity that the industry has built up in recent years. According to manufacturers that meet BloombergNEF's Tier 1 criteria, global module production capacity reached approximately 1,005 GW annually by the end of the first quarter of 2026.
The figure illustrates the speed at which the sector has grown: less than ten years ago, a factory with a capacity of 10 GW was considered one of the largest in the world. Today, several companies far exceed 100 GW annually.
In this context, the new standards promoted by Beijing could become a tool to accelerate market consolidation, favor the most technologically advanced manufacturers, and raise barriers to entry for lower-performing products.
In other words, while the industry is looking to emerge from ten consecutive quarters of losses, China seems to be betting on a new phase of competition based less on volume and more on efficiency, quality, and technological differentiation.