Solar power is set to serve as a transformative engine for China's vast rural regions, providing a sustainable and cost-effective solution to local energy needs while bolstering the nation's broader push toward carbon neutrality, according to national legislators and industry experts.

The rapid deployment of photovoltaic systems in the countryside is no longer merely a supplemental energy source but a strategic pillar for rural vitalization, said Zhong Baoshen, chairman and general manager of Longi Green Energy Technology Co, who is also a deputy to the 14th National People's Congress.

Zhong said: "Solar energy, which boasts zero fuel costs and minimal maintenance requirements, is already delivering substantial economic relief to rural households across China.

"By replacing inefficient traditional fuels, PV technology is effectively lowering living costs and creating new revenue streams for farming communities."

This shift aligns with the latest directives from the National Energy Administration.

During its first rural vitalization leadership group meeting of this year earlier this month, the NEA emphasized that advancing the energy revolution in rural areas is a top priority.

The administration has pledged to scale up rural wind and solar development while enhancing the comprehensive carrying capacity of rural power grids to ensure that energy development directly benefits village collectives and resident income.

Despite this progress, structural challenges remain in the "last lag" of the energy transition.

In his proposals this year, Zhong pointed out that many rural grids are currently hitting their capacity limits, leading to restricted access for new solar installations in certain regions.

Furthermore, a lack of price-risk management tools for farmers has also threatened the long-term stability of the sector, he said.

To bridge these gaps, Zhong suggested integrating rural grid expansion and modernization into the national infrastructure priority list. He advocated for the development of green inclusive finance and specialized insurance products to stabilize income expectations for households in an increasingly marketized power landscape.

Beyond the countryside, the solar industry is facing a crisis of involution, or cutthroat competition.

With domestic capacity reaching approximately 1,400 gigawatts against a global demand of roughly 700 GW, the market has slipped into a spiral of low-price, low-quality competition that stifles innovation, he said.

China aims to eliminate the value-added tax export rebate for photovoltaic products starting on April 1.

While the cancellation is expected to further increase export costs in the short term and compress profit margins, the move serves as a timely intervention to break the current deadlock of intense domestic competition.

Since 2024, the solar industry has seen fierce price wars at home that have depressed export prices, eroding profits and leading to anti-subsidy investigations abroad.

The withdrawal of continuous tax dividends, according to Liu Yiyang, executive secretary-general of the China Photovoltaic Industry Association, will help rationalize export prices.

The move will inhibit the overly rapid decline in export prices in the long run while alleviating the country's fiscal burden, he said.

Zhong called for a categorical approach to management, including raising national mandatory safety and fire-resistance standards to weed out inferior products.

He also proposed a rating system to monitor the financial health of solar enterprises, including asset-liability ratios, to prevent disorderly expansion and encourage healthy mergers.

Zhong also pointed out that expanding the use of green hydrogen, ammonia and ethanol will be crucial for China to achieve deep cuts in carbon emissions while ensuring domestic energy security.

While the future growth of power generation will mainly come from nonfossil resources, the sector is currently plagued by high costs and a lack of domestic application scenarios, he said.

Zhong's proposals include establishing mandatory green fuel usage ratios for the petrochemical and metallurgical industries, alongside the introduction of green fuel quotas in the shipping industry.

To make these fuels competitive, he recommended integrating certified carbon reductions into the China Certified Emission Reduction scheme for national market trading.

"Only by prioritizing high standards and systemic coordination can we ensure that China's energy standing remains unyielding amid global shifts," he said.