China added a record 264 GW of new wind and solar capacity in the first half of 2025, twice the level installed in the same period last year, according to Wood Mackenzie. Much of the surge was driven by developers rushing to qualify for the country’s auction-free renewable pricing mechanism before it expired in June.
Wind projects built before the deadline benefit from longer contract terms and pricing linked to the coal-fired power base price. Wood Mackenzie reports that the levelised cost of energy for onshore wind fell by 7 percent in 2025, improving project returns for developers able to secure auction-free status.
The first auctions held under the new competitive scheme point to tighter economics ahead. In Shandong Province, winning wind bids came in 9 percent below the average settlement price, and developers will face shorter contract periods and increased exposure to market pricing. Wood Mackenzie expects onshore wind internal rates of return to reach 13.6 percent in Shandong, compared with lower returns for solar.
Curtailment remains a key risk. Wind curtailment is forecast to exceed 5 percent in seven provinces over the next decade, although this is still lower than expected levels for solar. China’s 2026 target of 24 percent non-hydro renewables in power consumption will require a sharp rise in generation, driving total wind and solar capacity additions of more than 750 GW across 2025 and 2026.
Stronger capture prices and lower curtailment risk mean wind is likely to attract greater investment than in previous years, though project timelines and site constraints may limit the pace of development.
