China is pushing the widespread adoption of concentrated solar thermal power (CSP), which generates electricity using the sun’s heat, aiming to establish the technology as another renewable energy option alongside solar photovoltaic and wind power.
The city of Dunhuang, in the inland province of Gansu, was once a hub on the Silk Road. On the outskirts of the city, brightly glowing towers, still more than ten kilometers away, come into view amid the expanse of desert. The towers are the centerpiece of a CSP plant operated by local company Shouhang High-Tech Energy Technology.
The 260-meter towers do not emit light. Their tops appear dazzlingly bright because sunlight is reflected onto them by mirrors spread across an area 2.7 kilometers in diameter around the tower.
More than 10,000 mirrors swivel to track the sun’s movement, directing thermal energy toward liquid molten salt circulating inside the towers. The molten salt is heated to more than 500 degrees Celsius and used to boil water in a tank, producing steam that drives a power-generating turbine. The set up, broadly speaking, is how tower-type CSP plants work.
Unlike solar photovoltaic power, the technology can generate electricity at night. Molten salt stores heat effectively, and the turbine at the Dunhuang plant can continue operating for up to 11 hours after the sun goes down.
At the end of last year, the Chinese government made a major shift toward promoting the widespread adoption of CSP.
The National Development and Reform Commission, which oversees economic policy, and the National Energy Administration set a target of increasing installed CSP capacity to around 15 gigawatts by 2030. They called for accelerated development in nine provinces and areas, including Qinghai province and the northwestern region of Xinjiang.
China’s installed CSP capacity stood at 1.82 GW in 2025, according to the International Renewable Energy Agency (IRENA). The country already ranks second in the world after Spain’s 2.3 GW.
China’s installed solar photovoltaic capacity exceeds 1,200 GW. Even if it achieves its 2030 target, CSP would amount to less than 2% of the country’s solar photovoltaic capacity. Still, the target would be that equivalent of 15 nuclear reactors, based on a typical reactor capacity of around 1 GW.
By setting a national target, the central government likely seeks to give companies greater confidence to invest while also bringing down generation costs, which are currently 2.6 times those of solar photovoltaic power. The policy document setting out the target also calls for eventually reducing generation costs to a level comparable with coal-fired power.
Construction is spreading across China. According to the China Electricity Council, 24 CSP plants had been completed nationwide as of the end of June, while construction had already begun at another 26 sites.
China Energy Engineering, a major infrastructure builder, began construction in April on a power plant combining solar photovoltaic and concentrated solar thermal power at an elevation of 4,541 meters in Lhasa, Tibet.
China General Nuclear Power also began building what it said will be the world’s largest CSP plant in Qinghai in mid-June. The facility’s mirrors will cover an area equivalent to 518 soccer fields.
While CSP is drawing attention as a complement to conventional renewable energy, there are concerns about oversupply. Unchecked construction across the country could lead to the phenomenon known in China as neijuan, or “involution,” in which excessive competition would erode the profitability of power producers and equipment makers.
Such a development has happened before. China has aggressively expanded renewable energy sources such as solar photovoltaic and wind power over roughly the past decade. The country accounted for half of global installed capacity in both technologies in 2025, according to IRENA.
But the rush of companies into those sectors has driven down prices for equipment and other products, hurting earnings at many manufacturers. CSP could likewise encounter excessive competition if investment enthusiasm runs too high.
Signs of this trend are already emerging. Qinghai province in March announced plans to increase its CSP capacity, including projects under construction, to 8 GW by around 2030. That means a single province is planning capacity equal to more than half the central government’s nationwide target of 15 GW.
If other provinces and regions announce similar plans, the combined targets of local governments could exceed the central government’s goal. Beijing will need to fine-tune its policies to avoid repeating the problems seen in photovoltaic and wind power.
This article first appeared on Nikkei Asia. It has been republished here as part of 36Kr’s ongoing partnership with Nikkei.