Counteracting involution and boosting space-based photovoltaics, is the photovoltaic industry entering a window for revaluation?

Recently, the photovoltaic industry has seen a renewed focus from the market due to multiple factors, including the continued advancement of “anti-involution” policies, the broad prospects of space photovoltaics, and the strengthening of energy security due to geopolitical situations. Is the photovoltaic industry transitioning from “cyclical recovery” to “logical upgrade” as supply-side clearing leads to new demand catalysis?

Effects of the Photovoltaic “Anti-Involution” Policy Are Apparent

The Ministry of Industry and Information Technology has clarified that 2026 will be a key year for governance in the photovoltaic industry, emphasizing that “governing industry involution” is a top priority for this year. It will strengthen innovation-driven development, shape the competitive advantages of next-generation technologies, and resolve the dilemma of industry involution. (Reference: Sina Finance “Ministry of Industry and Information Technology’s Wang Shijiang: 2026 is a Key Year for Governance in the Photovoltaic Industry, Focusing on Four Aspects”, 2025.2.5)

Industry insiders state that multiple ministries have jointly established an “anti-involution” working mechanism, and so far, the “anti-involution” efforts have begun to show results.

Firstly, from within the industry, a preliminary consensus has formed, with most companies starting to abandon purely price wars and shifting towards technological innovation and value creation.

Secondly, the expansion of industry capacity has been somewhat curbed, with excessive investment promotion gradually being regulated, and low-level backward capacity is being cleared out. Prices across various links in the industrial chain are trending towards rationality.

In addition, industry self-discipline has begun to take shape, the situation of excessive competition has improved, market integration is starting to advance, and the willingness of upstream and downstream companies in the industrial chain to collaborate has increased, with cooperation deepening in areas such as technology research and development and supply chain layout.

(Reference: China Entrepreneur Magazine “Dialogue with Trina Solar’s Gao Jifan: How to Solve the Electricity Shortage Anxiety in the AI Era”, 2026.3.18)

Space Photovoltaics Open Up Market Demand Space

Space photovoltaics originally referred to deploying photovoltaic power generation systems in space environments, such as satellites, space stations, and other spacecraft, with its core application being to power the spacecraft itself. In the future, it may also expand to other uses. In recent years, under the International Telecommunication Union (ITU) “first come, first served” rule, countries must complete mass deployment by 2030, leading to an exponential increase in the number of satellites, with low Earth orbit satellite constellations reaching the “thousands to tens of thousands” level. (Reference: Guosen Securities “Long-term Space Photovoltaic Demand Further Opens Up, Three Technological Routes Have Broad Future Value Space”, 2026.3.2)

Institutions indicate that, on one hand, AI giants are competing fiercely, and “computing power in space” has become a consensus. Space photovoltaics, as a primary energy supply form, is expected to benefit greatly, with projections suggesting it could create a market space worth hundreds of billions for photovoltaic equipment in the future. On the other hand, leading Chinese photovoltaic equipment manufacturers possess strong capabilities for efficient iteration and rapid response, potentially entering the supply chains of related equipment like SpaceX and securing high-value orders, opening up new growth spaces. Furthermore, space photovoltaic equipment may exhibit significant inflationary effects, with its value expected to achieve a leap in enhancement. (Reference: Dongfang Caifu Network “Musk’s Big Moves! ‘Computing Power in Space’ has Become a Consensus, Space Photovoltaic Demand Expected to Grow Exponentially, These Companies Already Have Relevant Layouts”, 2026.3.23)

Geopolitical Turbulence Strengthens Energy Security, Photovoltaic “Substitution Logic” Heats Up Again

In addition, the recent escalation of the Middle East situation has intensified, making energy security a global focus once again. Against the backdrop of traditional energy being highly reliant on regional supply, the uncertainty of oil and natural gas prices and supplies is rising, prompting countries to accelerate their search for more reliable energy solutions. In this process, the strategic value of photovoltaics is being re-evaluated.

With the gradual improvement of the industry fundamentals and the continuous strengthening of long-term logic, the allocation value of the photovoltaic sector may gradually become apparent. For investors optimistic about the development prospects of the photovoltaic industry, the photovoltaic ETF managed by Yinhua Fund, Yinhua (516880), and its associated funds (Class A: 012928; Class C: 012929) provide a convenient tool for focusing on leading companies in the photovoltaic industry, which could help share in the benefits of the new energy revolution.

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Editor: Guo Xutong