Are Chinese solar panels the answer for Global South, or do costs not add up?

The rise of decentralised solar power has prompted the Pakistani think tank Renewables First to call for China to play a leading role in Pakistan’s energy transition, potentially creating a model for other countries in the Global South.

Strategic Questions

However, a Chinese energy scholar has questioned whether the vision outlined in the report may prove too expensive to implement at scale.

“China’s solar panels are outcompeting China’s power plants,” said Muhammad Basit Ghauri, lead author of the report by Renewables First.

China’s Strategic Choice

The report argues that China faces a strategic choice between the coal-fired power plants it has financed in Pakistan and the solar panels it has sold to the country, noting that both cannot remain profitable within the same market.

By supporting a unified clean energy vision in Pakistan, China “has the opportunity to develop and validate transition models that could be replicated across the Global South.”

Global Context

The United States’ retreat from climate diplomacy has created space for China to champion the global energy transition and redefine its role as a clean energy leader.

Pakistan’s Bottom-Up Transformation

Pakistan’s rapid adoption of decentralised solar is reshaping energy demand patterns. Households and businesses are increasingly bypassing conventional power structures in favour of rooftop solar solutions. According to Renewables First publications, this energy shift is weakening the financial viability of fossil-fuel-based generation assets.

Challenges and Opportunities

While Pakistan may serve as a proving ground for managing stranded fossil fuel investments while scaling renewable energy, some Chinese analysts have raised concerns over cost recovery, grid integration, and long-term financial exposure. Nevertheless, the report maintains that aligning clean energy exports, financing strategies, and diplomatic objectives could allow China to demonstrate credible leadership in the global energy transition.