Xiaoyang Li, Director, China Power and Renewables Research at Wood Mackenzie comments: ‘Despite facing over 20 markets with trade barriers and extreme US tariff rates reaching 696% for some solar products, Chinese companies added 35 new overseas facilities in 2024, demonstrating remarkable resilience in maintaining global market dominance in global renewable power manufacturing.’

According to Wood Mackenzie’s latest Looking Overseas report, export volumes for Chinese renewables climbed 20% year-on-year in 2024, with companies increasingly shifting from direct exports to overseas manufacturing to circumvent trade restrictions. Wind turbine exports surged 72%, while solar module and battery export volumes grew 11% and 28% respectively, although at slower rates than 2023’s explosive growth of 48% and 39%.

Fig 1: Chinese renewable power product export sales, 2020–2024
Note: lithium-ion battery export capacity used for the chart
Source: Wood Mackenzie

China holds a dominant position in the global renewable energy manufacturing sector, producing over 80% of the world’s wind turbines, solar panels and energy storage batteries, says the report. This leadership provides ‘significant cost advantages that competitors struggle to match’. On average, Chinese-made wind turbines manufactured outside of China are 28% cheaper than similar Western products; energy storage batteries are 31% cheaper and solar modules are 4% cheaper, according to Wood Mackenzie. This price difference makes Chinese products ‘particularly attractive to cost-conscious developers around the world’, it says.

‘While export volumes continue growing, companies are adapting their strategies to address local content requirements and trade tensions through overseas manufacturing,’ adds Li. ‘The fundamental economics of Chinse manufacturing efficiency means that even with tariffs and trade barriers, these companies maintain competitive advantages that are reshaping global supply chains.’

In addition, project investments under China’s Belt and Road Initiative – the government’s ambitious plan to develop new trade routes connecting China with the rest of the world – remain robust. The authors of the report counted 369 total overseas power projects, representing 34% growth over 10 years (2015–2024). Wood Mackenzie forecasts China may control nearly 80% of utility solar and wind capacity in top Belt and Road markets by 2030, creating a ‘strategic fortress of influence’ that bypasses Western trade restrictions entirely.

‘The focus of renewable investment is shifting towards the Middle East, Asia-Pacific and Caspian markets,’ comments Li. ‘With high-quality products made in China, greenfield investments are becoming more appealing to investors looking to establish projects in easily accessible markets. These regions act as both manufacturing hubs for global market entry and local demand centres, effectively creating parallel supply chains that bypass traditional trade barriers for China.’

Cost-based moves uncover policy limitations
The report discusses four primary business models that facilitate the growth of Chinese expansion overseas. These range from direct investor-led projects to partnerships with Western original equipment manufacturers (OEMs) as component suppliers. ‘This diversification strategy shows how trade barriers are not achieving their intended purpose of reducing Chinese influence,’ says Wood Mackenzie. ‘Instead, they are leading to more sophisticated supply chain structures that allow China to maintain control while giving the appearance of local compliance.’

Markets with stable political conditions in Asia, the Middle East and Latin America are increasingly attractive to Chinese manufacturers, while Europe has become less appealing due to substantial entry barriers and high project costs, suggests the market analyst. The Middle East, Asia-Pacific and Europe serve as strategic hubs for facility deployment, with Saudi Arabia and Oman’s ambitious 2030 renewable energy targets particularly attracting Chinese investment, it adds.

Revenue pressures signal intensifying competition
Despite an increase in export volumes, China’s total export revenues fell by 13% in 2024 due to a decline in prices resulting from heightened competition, according to the report. Solar module export sales dropped by 29%, while battery export sales decreased by 5%. ‘This situation suggests that although Chinese manufacturers are maintaining their market share, their profit margins are being squeezed by both trade barriers and internal competition,’ says Wood Mackenzie.

Local content policies, including the EU’s Net Zero Industry Act targeting 40% domestic production by 2030 and the US Inflation Reduction Act’s manufacturing incentives, have not only not deterred Chinese companies, but also paradoxically accelerated Chinese manufacturers’ global expansion, adds the report. ‘Trade barriers and local content rules aren’t reducing China’s influence, but they’re reshaping it. Instead of achieving true supply chain independence, we’re seeing more complexity and fragmentation in global renewable energy markets,’ concludes Li.