On July 28, 2026, the China Photovoltaic Industry Association released the latest supply chain price data: dense polysilicon fell to 35 yuan/kg, down 12% month-on-month, a yearly low. Wafer, cell, and module prices followed suit, causing a collapse in the PV chain. Meanwhile, energy storage system prices also plummeted, accelerating the path to grid parity for renewables.
Supply-Demand Imbalance Worsens, Polysilicon Keeps Bottoming
Entering H2 2026, the polysilicon market's oversupply further deteriorated. With domestic capacity exceeding 3 million tons/year, slower demand growth led to high inventory. In late July, actual transaction prices for dense polysilicon ranged 32-38 yuan/kg, with an average of 35 yuan/kg, down over 60% year-on-year. Upstream producers generally face losses; some second-tier firms announced production cuts for maintenance, but a reversal will take time.
Wafer Prices Follow Down, 182mm Sees Sharp Drop
Wafers also face pressure. On July 28, industry leaders Longi Green Energy and Zhonghuan lowered quotes: 182mm monocrystalline wafers to 1.05 yuan/piece, down 8.7% week-on-week; 210mm at 1.45 yuan/piece, milder decline. Analysts note capacity utilization under 70%, with inventory pressuring prices; weakness is expected into August. Smaller wafer makers face cash cost losses, speeding up industry consolidation.
Cell and Module Prices Hit Record Lows
Downstream cells and modules keep falling. On July 29, PERC monocrystalline cells (166mm) quoted at 0.35 yuan/W, halved from early 2026; TOPCon at 0.42 yuan/W, smaller drop. For modules, leading brands’ 182mm bifacial spot prices near 0.7 yuan/W, with second- and third-tier brands as low as 0.65 yuan/W. Low-price orders appear in South America and Middle East; China's module export average falls below 0.8 USD/W.
Energy Storage Prices Plummet, System Cost at 0.6 Yuan/Wh
Along with the PV chain, storage system prices also crashed sharply. On July 28, CATL and BYD led price cuts for storage cells: 280Ah LFP cells averaged 0.25 yuan/Wh, down 35% from year start. Storage system integrator quotes fell accordingly: 1C/4-hour systems (excluding PCS) at 0.6 yuan/Wh, a new low.
Cost drops directly stimulate demand. Bidding projects for storage in Inner Mongolia, Xinjiang and other western provinces surged; cumulative bidding exceeded 10 GWh in the first three weeks of July. The IRR of independent storage stations rebounded to over 6%, improving business viability. However, low prices squeeze integrator margins, with profits concentrating on cells and BMS.
Energy Market Impact: Accelerating Grid Parity, Thermal Power Pressured
Module prices below 0.7 yuan/W combined with storage costs at 0.6 yuan/Wh further reduce the LCOE of renewables. In good solar resource areas, PV+storage LCOE has fallen below 0.25 yuan/kWh, significantly undercutting coal benchmark prices, crowding out traditional thermal plants and potentially lowering spot power market price anchors.
Meanwhile, low prices fuel distributed PV. Home system installation costs drop below 2.5 yuan/W, making self-consumption economical. 2026 is expected to see new PV installations exceed 250 GW and new storage over 80 GWh, both all-time highs.
Outlook: Approaching Bottom, but Reversal Awaits
Many analysts believe PV chain prices are near a bottom. Polysilicon prices are close to the full cost line of some high-cost capacity (around 30 yuan/kg), leaving limited room to fall. Wafer and cell inventory is expected to clear by end-August, and with Q3 peak season demand, prices may stabilize in September. For storage, cell prices have breached breakeven for some second-tier makers, weakening further downside.
However, overseas trade policy risks warrant attention. The US and EU have recently proposed anti-dumping investigations into Chinese PV products, which could hit exports if implemented. Domestically, distributed PV grid integration issues remain; curtailment rates have risen in some areas, requiring grid investment.
Overall, renewable energy prices will likely fluctuate at low levels in H2 2026, accelerating industry shakeout. Companies with cost and tech advantages can solidify positions during the downturn. For investors, focusing on left-side opportunities in PV and storage may be the time to 'be greedy when others are fearful.'
