Over the past year, central and state-owned enterprises have been frequently selling and transferring assets related to new energy such as photovoltaic and wind power. Especially in the past six months, five central and state-owned enterprises have transferred the new energy assets of 19 subsidiaries. Industry insiders point out that the Chinese Communist Party’s new energy policies, transitioning from subsidy reduction to grid parity, and further to free competition in the electricity spot market, have led new energy power plants into an unprofitable predicament, making them a “hot potato.”
华夏能源网 reported on Monday (August 18) that according to incomplete statistics, in recent months, several central and state-owned enterprises have transferred the new energy business of 19 subsidiaries. Among them, Dongfang Electric and Three Gorges Group each transferred five subsidiaries, State Power Investment Corporation transferred seven, while China Communications Construction Group and Shandong Energy Group each transferred one. In addition, two private companies, JA Solar Technology and Titan Energy, collectively transferred the new energy business of nine subsidiaries.
According to statistics from Beijing Property Exchange and Shanghai United Property Exchange, from January 2024 to April 2025, more than a hundred transactions of new energy assets were made, with central and state-owned enterprises accounting for over 70%.
In 2024, central enterprises such as State Power Investment Corporation, State Grid Corporation of China, China General Nuclear Power Group, Dongfang Electric Corporation, Three Gorges Group, China Energy Engineering Group, CNNC, China Coal Group, Sinopec, CRRC, and State Grid Southern Power Grid, among others, listed new energy power plant assets for sale on property exchange platforms.
During this process, State Power Investment Corporation (referred to as “SPIC”) has been at the forefront of divesting and transferring new energy assets, with a total of nearly 40 new energy companies’ equity transferred, involving a total installed capacity of over 3.2 GW in photovoltaic and wind power projects, valued at approximately 18 billion yuan.
On June 16, SPIC subordinated company, China Electric Power Investment Corporation Zibo Energy Investment Co., Ltd., and SPIC Group Green Energy Technology Development Co., Ltd. collectively transferred 51% equity of Zibo Lubei Clean Energy Co., Ltd.
By the end of April, SPIC’s Zhongshan Rongli New Energy Co., Ltd. and Jingxian Jiangneng New Energy Technology Co., Ltd. publicly transferred their equity and bonds.
On April 11, SPIC’s Wuling Power officially announced the transfer of equity in four new energy companies. These companies are: Ruzhou XinSun Photovoltaic Power Co., Ltd (55% equity, starting price of 173 million yuan), Jiangling County XinSun Photovoltaic Power Co., Ltd (55% equity, starting price of 214 million yuan), Xinan County XinSun Photovoltaic Power Co., Ltd (55% equity, starting price of 158 million yuan), and Qingyuan Yousheng Asset Investment Co., Ltd (51% equity, starting price of 171 million yuan).
Furthermore, on August 5th and 6th, Dongfang Electric transferred full ownership of three photovoltaic companies: Luquan Dong Electric Solar Power Co., Ltd, 100% equity; Dongyao New Energy (Qujing) Co., Ltd, 85.02% equity; Quzhou Huihe New Energy Technology Co., Ltd, 100% equity.
Blogger “Hai Yu Xinghe” analyzed that the logic behind central enterprises selling assets is straightforward: cutting off inefficient assets to preserve profitability. The inspection team had singled out SPIC for having a “large but weak” photovoltaic sector, demanding it to “focus on existing strengths” and clear all loss-making projects.
Of note, on July 16, Three Gorges Energy announced the transfer of 49% equity in Qujing Jingrui New Energy Co., Ltd for a starting price of only 1 yuan. The company, founded on September 18, 2024, with Three Gorges Energy holding 49% and JA Solar Power (China) holding 51%, was transferred less than a year after its establishment.
In addition to selling operational new energy assets, central enterprises are also terminating existing projects. On August 15, Zhongtan Composite New Energy Group Co., Ltd. terminated the 2025-2026 framework purchase of photovoltaic components. It is noteworthy that this company is a subsidiary of the China Aviation Industry Corporation under central enterprise ownership.
According to incomplete statistics from DataBM.com on new energy, since August, nine photovoltaic projects have been successively terminated, involving a total capacity of 1586.787MW. Additionally, within the same period, many projects have experienced abnormal activities such as suspension, cancellation, and delays.
Wind and solar new energy projects were once referred to as “cash cows,” but have now become a “hot potato” being massively sold off by both private and state-owned enterprises, mainly due to a decrease in station profitability.
In 2024, SPIC terminated the Shandong Naren Tai New Energy 100MW household photovoltaic project, citing its net asset
profitability being only 1.8%, well below the 7% capital profit rate threshold.
This is not an isolated case. A central enterprise indicated in a 2024 work conference summary that nearly 40% of newly added new energy projects in recent years failed to achieve the promised profit rate, with some projects continuously in the red or even facing losses upon production, indicating a scenario where new energy is not increasing profits.
An industry insider informed Huaxia Energy Network that the decrease in profitability or even losses of photovoltaic power plants is due to various factors. In recent years, under the rapid increase in installations, policies such as time-of-use electricity pricing, new energy participation in market-based trading, and restrictions on power generation have led to significant challenges for many power stations, rendering them unprofitable.
The reduction in station profitability and losses can be attributed to plummeting electricity prices, with instances even reaching negative pricing. In June, the average contract price of electricity in economically significant provinces like Jiangsu dropped by 24%, and Guangdong saw an 8.3% decrease.
The situation worsens in the electricity spot market, with Shandong, Zhejiang, and Inner Mongolia all experiencing negative electricity prices. From January to May, Inner Mongolia’s spot market clearing price has plummeted by 52%.
China’s photovoltaic industry has relied on government subsidies and incentives to turn a profit. David Huang, a Chinese-American economist, mentioned to Epoch Times, “It’s basically a rush to maximize government subsidies under government policy support.”
However, as the Chinese Communist Party gradually incorporates new energy prices into market pricing mechanisms, not only are subsidies disappearing, but new energy prices are also significantly dropping.
In February of this year, the National Development and Reform Commission issued Notice No. 136 on deepening the marketization reform of new energy on-grid electricity prices, stating that the electricity generated by new energy projects should ideally enter the electricity market, and on-grid electricity prices should be formed through market transactions. This means that the pricing for distributed photovoltaics will no longer be dictated by fixed prices but will be closely tied to market supply and demand.
In the past, new energy had the privilege of being purchased in advance, with subsidized electricity prices even higher than those of thermal power. However, within just over a decade, new energy has transitioned from subsidy reduction to grid parity and quickly entered the electricity spot market, leading to a significant downward trend in electricity prices, with some regions even witnessing negative pricing.
On September 17, 2023, He Yongjian, Chairman of Science and Technology Research Institute of State Power Investment Corporation, stated in a forum speech that “the underlying logic of new energy development has changed, and there will be uncertainties in both power output and electricity prices in the future.”
The intermittency and instability of wind and solar new energy sources have rendered them unable to respond in real-time to the needs of the grid or users, making them uncompetitive in the electricity spot market, turning wind and solar power into a “hot potato.”