China Advances PV Price Governance as Cost Accounting Framework Moves Into Implementation
China’s efforts to steer the photovoltaic industry from price-driven competition toward higher-quality development has gained momentum following a high-level price compliance meeting on Friday, held by the State Administration for Market Regulation or SAMR.
Industry participants widely viewed the meeting as a step towards implementation following last week’s release of the General Principles for the Cost Accounting Model of the Photovoltaic Industry, suggesting the new framework is evolving into a broader regulatory mechanism for governing market competition.
The meeting in Yancheng, Jiangsu province was attended by senior officials from SAMR, the National Development and Reform Commission, the Ministry of Industry and Information Technology or MIIT and the Ministry of Commerce, regional market regulators, China Photovoltaic Industry Association or CPIA and representatives from 27 leading PV manufacturers. The breadth and seniority of the attendees underscored Beijing’s shift from relying primarily on voluntary industry self-discipline toward coordinated regulatory oversight involving both central and local authorities, market participants said.
The meeting followed last week’s release of the General Principles for the Cost Accounting Model of the Photovoltaic Industry, developed by the CPIA under the guidance of the SAMR and the MIIT. The standard establishes a unified accounting methodology for polysilicon, wafers, cells and modules after differences in accounting practices—particularly between vertically integrated and specialized manufacturers and across different technology routes—made meaningful cost comparisons increasingly difficult.
At the meeting, SAMR urged PV manufacturers to strengthen cost accounting, establish robust price compliance systems, conduct internal compliance reviews and compete more rationally while refraining from cut-throat price wars. Leading manufacturers were tasked with setting industry benchmarks through compliant pricing practices, while CPIA was instructed to promote the new standard’s implementation and help prevent illegal pricing practices, including below-cost dumping.
SAMR also signaled a tougher enforcement approach by integrating standardized cost accounting into price supervision. The regulator said it will promote orderly competition through compliance reminders, regulatory interviews and administrative guidance, with companies that continue to disrupt market order after regulatory warnings facing legal action.
Industry participants said Friday’s meeting was one of the highest-level government interventions in PV pricing practices to date. One market source said that although regulators did not introduce specific pricing rules or minimum price requirements, the meeting established clearer compliance expectations and regulatory boundaries, marking a notable shift from previous reliance on voluntary industry initiatives.
“The industry’s path out of its current difficulties has been under continuous exploration,” the source said. “A regulatory framework based on standardized cost accounting, supported by the Price Law and various industry standards, and aimed at curbing excessive low-price competition now appears to be taking shape.”
Another industry source, however, cautioned that the framework’s effectiveness will ultimately depend on how it is implemented in day-to-day operations, commercial negotiations and pricing practices, as well as the extent to which manufacturers disclose cost information.
“Manufacturers have different cost structures, so whether the unified accounting model can adequately capture those differences will need to be tested in practice,” the source said. “In my view, truly comparable cost data would require comprehensive cost disclosure by manufacturers and independent third-party verification.”
—Reporting by Summer Zhang, szhang@opisnet.com; Editing by Mei-Hwen Wong, mwong@opisnet.com