Wind power takes the lead in breaking out of "involution"

Since November 2024, the bid price for wind turbines in China (excluding towers) has not fallen below 1,400 yuan/kW—this is the cost line for most wind turbines.

"This means that the wind power industry has stopped the price war and has emerged from 'involution,'" said Qin Haiyan, Secretary-General of the Wind Energy Special Committee of the China Renewable Energy Society (hereinafter referred to as the "Wind Energy Special Committee"), to Caijing.

The price rebound has driven an overall recovery in the wind power manufacturing industry's profitability. According to WanLian Securities, in the first three quarters of 2025, the overall operating revenue of the wind power industry chain was 289.507 billion yuan, a year-on-year increase of 26.42%; the net profit attributable to the parent company was 14.78 billion yuan, a year-on-year increase of 21.90%. Among them, leading enterprise Goldwind achieved a net profit of 1.097 billion yuan attributable to shareholders of the listed company in the third quarter of 2025, a year-on-year increase of 170.64%.

Wind power and photovoltaics have always been mentioned together, but while the photovoltaic manufacturing industry is still losing money and engaging in price wars, why has the wind power manufacturing industry been able to emerge from "involution" first?

Caijing has summarized the views of several industry insiders, and the reasons are mainly fourfold:

1. The number of wind power enterprises is fewer than that of photovoltaics, and the market share of leading enterprises is relatively concentrated, resulting in a lower willingness to expand market share through price wars;

2. The technical threshold for wind turbines is higher than that for photovoltaic modules, and the number of wind turbine manufacturers has gradually decreased in recent years, with no new players entering the market;

3. The technological iteration and scaling of wind turbines are progressing rapidly, and the increase in safety incidents has urged the industry to move away from low-price competition and focus on quality and safety;

4. Wind power enterprises have learned from the last round of industry reshuffling: quality and safety are the bottom line, and wind power enterprises that do not adhere to this principle will inevitably be eliminated.

Around 2010, there were nearly 80 wind turbine manufacturers in China. According to the Wind Energy Special Committee, in 2024, there were 13 new turbine manufacturing enterprises with installed capacity, of which the top 5 accounted for 75% of the market share, and the top 10 accounted for 98.6%.

After the end of the subsidy era, the wind power industry has moved beyond a policy-driven development logic and entered a mature development stage driven by the market.

At the 2025 Beijing International Wind Energy Exhibition held in mid-October, dozens of Chinese wind power manufacturing enterprises jointly released the "Beijing Declaration 2.0," which set a development goal of adding no less than 120 million kW of new installed capacity annually during the "14th Five-Year Plan" (2026-2030), ensuring that by 2030, China's cumulative installed wind power capacity reaches 1.3 billion kW, and by 2035, the cumulative installed capacity is no less than 2 billion kW, reaching 5 billion kW by 2060.

From the end of 2020 to the end of 2024, China's cumulative installed wind power capacity increased from 281 million kW to 520 million kW, with an average annual increase of nearly 60 million kW, exceeding the target of an average annual new installed capacity of over 50 million kW set in the "Wind Energy Beijing Declaration" released at the 2020 Beijing Wind Energy Exhibition.

Self-discipline and Self-rescue

According to statistics from the Wind Energy Special Committee, the monthly weighted average price of onshore wind turbines (excluding towers) fell to a historical low of below 1,400 yuan/kW in September and October 2024. However, it began to rebound in November 2024: except for January 2025, when prices were lower due to the Spring Festival, the price remained above 1,450 yuan/kW in other months.

Without considering research and development costs, marketing and sales costs, management expenses, and indirect costs, the cost of wind power complete sets below 8 megawatts is between 1,400 yuan/kW and 1,600 yuan/kW; the cost of turbines above 8 megawatts is about 1,300 yuan/kW. From February to October 2024, the monthly average bidding price of Chinese wind turbines fell below 1,400 yuan/kW six times, breaking the cost line for the vast majority of companies.

Since November 2024, turbine prices have stabilized and rebounded for over six months. Behind this change in situation is an industry self-discipline and self-rescue effort.

On October 16, 2024, the Wind Energy Special Committee organized 12 wind turbine manufacturers to sign the "Self-Discipline Convention for Maintaining a Fair Competitive Environment in the Chinese Wind Power Industry" (hereinafter referred to as the "Self-Discipline Convention"). At the same time, a convention execution management committee and a disciplinary supervision committee were established. If any wind power company bids below cost, the relevant committees of the self-discipline convention will report to the relevant authorities and take legal measures to punish the violating companies.

These 12 companies collectively occupy more than 99% of the Chinese wind turbine market. The Wind Energy Special Committee is not an administrative body and does not have enforcement power, but it is the most influential third-party organization in the Chinese wind power industry and has strong appeal.

In addition to having manufacturers sign the self-discipline convention, the Wind Energy Special Committee also organized wind power development companies to reach a consensus to move out of the internal competition. On November 15, 2024, the Wind Energy Special Committee held the "2024 Wind Energy Enterprise Leaders Forum," attended by the main leaders of more than 40 wind power companies, including major wind power project developers and wind turbine manufacturers.

The key consensus reached at the forum was to optimize the bidding scheme and evaluation methods by setting more comprehensive and reasonable evaluation indicators to comprehensively assess the research and development, manufacturing, and quality assurance capabilities of complete set manufacturers; increase the weight of technical scoring, refine technical indicator scoring, and eliminate the lowest bid winning.

Leading wind power development companies played a leading role. On November 22, 2024, the State Power Investment Corporation announced the results of the second batch of onshore wind turbine centralized procurement bidding for 2024. The total scale of the project is 8.4GW, including 7.2GW of procurement capacity and 1.2GW of reserve capacity, with the 7.2GW procurement capacity divided into 30 small bidding sections. The average bid price for the 30 sections was 2,092 yuan/kW, with an average lowest bid of 1,882.5 yuan/kW and an average highest bid of 2,334.5 yuan/kW. This set of prices is significantly higher than the previous average bidding price.

The reason for the price increase is that the State Power Investment Corporation modified the calculation method for the evaluation benchmark price in this bidding procurement. Previously, the price scoring proportion in the bidding rules of wind power development companies generally reached 40%-55%, and the lowest bid was often the evaluation benchmark price. If the bidding price exceeded the benchmark price, points would be deducted proportionally In this bidding, the State Power Investment Corporation set the evaluation benchmark price at a 5% discount from the arithmetic average of the effective bidding prices of the bidders. When a company's bid is less than or equal to the benchmark price, it receives full marks; when a company's bid is higher than the benchmark price by up to 5% (inclusive), it loses 0.4 points for every 1% increase from the full score; for any portion exceeding 5% above the benchmark price, it loses 0.8 points for every 1% increase. This means that the lowest bidder no longer has a clear advantage.

The modification of the bidding rules for the above project is considered by the industry to be a landmark event that changes the direction of the current price war in the wind power industry. Subsequently, most other wind power developers followed suit and modified their bidding rules, gradually phasing out the lowest bid winning model over the past six months.

A representative from a leading wind power manufacturer told Caijing that no company can withstand further price drops, whether manufacturers or developers; everyone has returned to rationality and is no longer pursuing low prices.

After signing a self-discipline convention last year, major wind turbine manufacturers also signed commitment letters to comply with the self-discipline convention in March this year. Qin Haiyan stated that each company's specific costs vary, and the industry association cannot require all wind turbine manufacturers to adhere to the same price bottom line, but bidding should not be below the cost price, which should be the legal bottom line that companies must follow. For wind power companies, practicing self-discipline is essentially a form of self-rescue.

Accidents and Iteration

If the focus is solely on reducing the initial installation cost per megawatt of wind turbines, there is a high likelihood of facing increased operation and maintenance costs in the future; when accounting for the entire lifecycle, the cost per kilowatt-hour of wind power projects may actually rise instead of fall. Both wind power manufacturers and developers are calculating this, and stepping out of the price war is a timely loss prevention measure.

At a closed-door meeting at the end of 2024, a management representative from a leading wind power manufacturer projected scenarios where accidents lead to increased lifecycle costs per kilowatt-hour: taking a project with a capacity of 100 megawatts and 20 units as an example, assuming an initial investment of 5,100 yuan per kilowatt and an equivalent operating hour of 2,300 hours. If five gearboxes are replaced in the tenth year, the cost per kilowatt increases by 124 yuan; if five sets of blades are replaced in the fifth year, the cost per kilowatt increases by 175 yuan; if a unit collapses in the tenth year, the cost per kilowatt increases by 158 yuan.

The representative urged a return to the essence of wind power technology, focusing on reducing the lifecycle cost per kilowatt-hour rather than merely pursuing low prices for turbines.

According to statistics from the Wind Energy Special Committee, the number of major accidents in China's wind power industry, such as tower collapses, fires, and critical component failures, has been on the rise, with 95 incidents in 2021, increasing to 114 in 2022 and 130 in 2023. The newly installed wind power capacity in China for 2021, 2022, and 2023 was 47.57 million kilowatts, 37.63 million kilowatts, and 75.90 million kilowatts, respectively.

In the typical law enforcement cases for power safety production supervision released by the National Energy Administration, the number of violations in wind power projects in 2024 has significantly increased compared to the previous two years. Compared to the total number of operational wind turbines, the number of major accidents has not shown explosive growth. However, the increase in accident numbers serves as a warning for wind power companies to enhance their investment in safety production In the statistics of major accident cases compiled by the Wind Energy Special Committee, key component failures account for 62%, while wind turbine topple and fires account for 18% and 6%, respectively. Among the types of component failures, blade failures account for 44%, with failures of bolts, towers, gearboxes, generators, and other components occurring from time to time. These component failures will increase the lifecycle costs of the project.

If a new wind turbine goes through a development process that includes comprehensive testing of prototypes, small batch verification, and then large-scale application, it generally takes two to three years for it to hit the market. However, in the past two years, many new turbines have completed mass production in about six months. These wind turbines, which require higher technology and larger dimensions, must achieve higher power generation efficiency while also lowering costs—something that is difficult to accomplish in a short time.

Qin Haiyan stated that in order to achieve the goal of being both efficient and low-cost, manufacturers may pursue refined design and reduce redundancy to lower costs. This requires subsequent manufacturing processes to be managed with precision, stricter process control, and more detailed site assessments; otherwise, even a slight oversight could lead to quality issues. Refined design should be the direction of technological advancement in the industry, but the industry should not rush.

Currently, both wind power developers and manufacturers believe that a critical point has emerged in balancing safety and cost. Safety performance must be guaranteed, and engaging in price wars will not allow for increased safety investments.

In the development history of China's wind power industry, there have been lessons learned from leading companies falling due to quality issues. Founded in 2006, Huayi Wind Power surpassed Goldwind in 2008 to become the company with the highest market share in China's wind power manufacturing industry. However, starting in 2011, Huayi Wind Power saw a sharp decline in orders due to quality issues; by 2014, the company had fallen out of the top ten wind turbine manufacturers.

The Legacy of Industry Restructuring

Compared to photovoltaics, the relatively low number of wind power companies and low inventory levels are legacies of the last round of restructuring in the wind power industry.

The years during which Huayi Wind Power rose to become an industry champion and then fell out of the top ten coincided with a phase of intense price wars, frequent quality issues, and significant restructuring in the Chinese wind power industry.

From 2008 to 2010, the bidding price for wind turbines dropped from 6,000 yuan/kW to below 4,000 yuan/kW. The number of wind turbine manufacturers rapidly expanded from fewer than 10 before 2006 to about 80 by 2010.

In the following years, the number of wind turbine manufacturers and component producers gradually decreased, leading to increased market concentration. In 2013, the top five companies in terms of newly installed wind power capacity in China had a combined market share of 54.1%, which grew to 75% by 2018. According to the latest statistics from the Wind Energy Special Committee, there will be a total of 13 turbine manufacturing companies with new installations in the Chinese wind power market in 2024, with the top five holding a market share of 75% and the top ten accounting for a total market share of 98.6%.

The extent of the current price decline is greater than that of the decline around 2010. According to the latest statistics from the Wind Energy Special Committee, the average bidding price for onshore wind power in China dropped from over 3,000 yuan/kW at the beginning of 2021 to 1,400 yuan/kW by mid-2024, a decline of over 50% However, almost no companies in the wind power industry went bankrupt during this round of price reduction.

The decline of Huayi Wind Power was attributed not only to quality issues but also to another important factor: excessive inventory. At the end of 2011, Huayi Wind Power's inventory reached 8.828 billion yuan. By the end of 2013, the company's inventory still exceeded 9 billion yuan. It wasn't until the end of 2014 that this figure decreased, with an inventory balance of about 6 billion yuan, while Huayi Wind Power's operating income for 2014 was 3.6 billion yuan.

Several industry insiders told Caijing that having learned from previous lessons, most wind power companies today have very little inventory.

Qin Haiyan stated that for wind turbine manufacturers, general-purpose factory buildings are sufficient for their assembly production lines, and they typically do not hold inventory of raw materials and components. The production capacity of the entire production line is quite flexible, covering a wide range of turbine models, so manufacturers generally do not have much inventory. For wind power component manufacturers, due to rapid technological iterations in recent years, advanced production capacity is in tight balance, with only a small amount of outdated capacity that cannot be upgraded being somewhat surplus. Moreover, apart from China, the global wind power industry chain is in a state of tight supply.

CITIC Construction Investment Securities released a research report predicting that the average bidding price in China's wind power industry will rise by 5%-10% in 2025. Coupled with the cost reduction of the main units themselves, it is expected that the gross profit margin of wind power main units will see significant growth in 2026, marking the beginning of an upward cycle for the wind turbine industry.

Leading wind power company Goldwind Technology reported an operating income of 48.147 billion yuan in the first three quarters of 2025, a year-on-year increase of 34.34%; the net profit attributable to shareholders of the listed company was 2.584 billion yuan, a year-on-year increase of 44.21%.

Source: Caijing Magazine

Risk Warning and Disclaimer

The market has risks, and investment requires caution. This article does not constitute personal investment advice and does not take into account the specific investment objectives, financial conditions, or needs of individual users. Users should consider whether any opinions, views, or conclusions in this article are suitable for their specific circumstances. Investment based on this is at their own risk