pv magazine: How do you see the global PV supply chain evolving over the next 12–24 months, particularly in terms of pricing, capacity and supply-demand balance?
Edurne Zoco: The global PV supply chain will remain oversupplied over the next 12–24 months, even as consolidation slowly picks up. China alone has more than 900 GW of annual cell production capacity, while global demand is about 590 GW, so capacity will only gradually exit the market. Technology shifts will help reduce capacity. We expect continued consolidation and low global prices, but increasingly divergent prices across regions. Trade barriers, local-content rules and security concerns are shifting the industry from “cost-first” to “resilience-first.” From suppliers’ perspective, access to protected markets has become a key driver of pricing resilience and margins, and market access now matters as much as production costs.
Is Chinese overcapacity affecting cells and modules, inverters and batteries alike?
Yes, but each segment is at a different stage. Solar is furthest along: average margins at leading module makers fell from about 9% in 2023 to negative levels in 2025. Inverters face steady price pressure, with shipments growing but revenue remaining flat. Batteries are earlier in the cycle and still profitable. Manufacturing capacity is expanding rapidly, and cells and storage hardware already face stronger price competition. BESS is not yet where solar is, but some of the same pressures are emerging. The supply of the most in-demand, high-quality cells remains tight.
pv magazine Session @ NetZero Milan Expo Summit 2026
The dynamics shaping global PV supply chains – including solar modules, inverters, and battery energy storage systems – will be discussed during the “Decoding solar supply chains” session at the NetZero event in Milan on Oct. 21.
The session will examine the forces reshaping clean energy supply chains, from manufacturing and sourcing strategies to shifting trade and regulatory requirements. It will also explore what these developments mean for companies procuring solar and energy storage equipment in an increasingly complex global market.
Join us in Milan to hear from industry experts and take part in the discussion on the future of solar supply chains.
What is driving module prices, and are today’s levels sustainable?
The main drivers are excess capacity, low utilization, technology changes, Chinese tax and efficiency policies, and fragmented trade rules. Manufacturers are cutting older production lines, using less silver and silicon, and moving toward higher-efficiency products. China’s consumption tax is expected to add only a marginal cost to PV capex, with suppliers expected to absorb most of it due to weak domestic demand.
Rather than a single global price recovery, prices are likely to diverge: commodity markets will remain under pressure, while protected markets will pay premiums for compliant, locally produced or traceable modules.
Current prices are not sustainable for most manufacturers. This is the main reason many module producers are diversifying into the production of other components or increasingly into services and software to capture additional value beyond hardware.
How are technology shifts affecting supply chains, procurement and inventory risk?
China’s new efficiency standards, effective from January 2027, effectively phase out older PERC technology, accelerating the shift to TOPCon, back-contact and next-generation cells. China is also exempting perovskite, tandem and other emerging technologies from the consumption tax through 2028. R&D is becoming more important as China shifts competition from scale toward technology and efficiency.
This increases the risk of existing stock becoming obsolete, and suppliers may sell non-compliant modules at low prices before the deadline. Buyers should look beyond price to technology roadmaps, warranties, traceability and suppliers’ financial strength. This is especially relevant in Europe, where excess inventory continues to delay a more comprehensive market reset.
What are the key inverter trends, and where are the biggest risks?
Inverter volumes continue to grow while prices fall. Nine of the top 10 suppliers are Chinese. The biggest risk is now regulatory and political rather than technical. The US Federal Communications Commission (FCC) restriction on new foreign-made inverter models favors vertically integrated, foreign entity of concern (FEOC)-compliant manufacturers. The risk is that switching models late in a project can trigger new interconnection studies.
In Europe, the EU has removed funding eligibility for inverters from “high-risk” suppliers in EU-funded projects. To mitigate risks, manufacturers will need to consider localization plans, supply chain compliance with regulations such as the Cybersecurity Act, and exposure to protected markets. All of these factors will increasingly determine pricing and growth.
Inverter suppliers will increasingly need to support grid stability and resilience. The ability to provide grid-forming capabilities is becoming a must-have feature for manufacturers serving utility-scale applications. Inverter suppliers are also expanding into new end markets, such as data centers, through solid-state transformers (SSTs). While many inverter suppliers have been very active in front-of-the-meter energy storage applications, data centers represent a high-growth opportunity given significant power volatility and the need for equipment that can respond rapidly to load swings.
As battery storage becomes increasingly integrated with solar, how is the battery supply chain changing, and what should buyers watch regarding pricing, technology, availability and supplier bankability? Is overcapacity becoming an issue?
Value is shifting from cells to systems, software, integration and services, while solar manufacturers are moving into storage. Battery storage will become one of the energy transition’s most important value pools, attracting more solar manufacturers. As cells become commoditized, competition is shifting toward software, integration, safety, bankability and energy services, while AI data center demand is opening up new growth opportunities.
Overcapacity is emerging, but headline figures overstate it. Our data shows that leading producers are operating near full capacity, and supplies of mainstream, high-quality 314 Ah cells have remained tight since the second half of 2025. BESS is less concentrated than solar, but buyers should watch cell-format availability, product qualification and, above all, supplier strength, as consolidation is likely in this segment too.
The post Global PV oversupply accelerates consolidation, regional price divergence appeared first on pv magazine Global.
