A new report by the International Energy Agency (IEA) shows that Chinese solar panel exports to Iran during the January–September period fell to less than one-fifth of the level recorded in the same period last year.
Data from energy think tank Ember show that China exported just 138 megawatts of solar panels to Iran during those nine months, worth approximately $15 million.
The decline comes as Iran grapples with severe natural gas shortages, air pollution and drought, leaving the government with limited options to expand thermal and hydropower generation, even if sufficient funding were available.
According to assessments by Iran's Energy Ministry and parliament's research centre, the country needs to add more than 5,000 megawatts of electricity generation capacity annually to avoid power shortages.
Failure to meet generation expansion targets in recent years has left Iran facing substantial electricity deficits throughout the year. During peak summer demand, the shortfall can exceed 20% of peak consumption.
The recent war has compounded those pressures. Iranian officials say around 4,000 megawatts of the country's power generation capacity were damaged during the conflict.
In April, a major warehouse storing equipment for Iran's solar power projects was also targeted in an attack. Iran's Renewable Energy and Energy Efficiency Organization (SATBA) estimated damage to the renewable energy sector at approximately $1.5 billion.
In recent years, the government has increasingly focused on solar power development.
According to the International Renewable Energy Agency (IRENA), Iran's installed solar power capacity surged by 128% in 2025 from the previous year, reaching approximately 1,781 megawatts.
Data from Ember, cited by the IEA, also show that Iran's solar panel imports from China in 2024 and 2025 combined were more than ten times higher than in previous years, suggesting considerable room for further expansion of the country's solar power capacity.
The sharp decline in imports this year could therefore undermine efforts to sustain that expansion, although the figures do not establish how much equipment Iran may already have in stock.
Iran falls behind regional competitors
Despite its recent solar expansion, Iran has fallen significantly behind regional competitors.
In 2025, Turkey and Saudi Arabia each added around five times as much solar capacity as Iran. Their total installed solar power capacities were approximately 12 times and seven times Iran's, respectively.
Another major weakness in Iran's renewable energy sector is the lack of progress in wind power. The country's installed wind capacity has remained unchanged at 378 megawatts for several years.
By comparison, Turkey commissioned around 2,000 megawatts of new wind power capacity last year, bringing its total to nearly 15,000 megawatts.
Globally, 692 gigawatts of new renewable power capacity were installed last year. Renewable capacity growth in the Middle East was approximately 28%, with Saudi Arabia recording the region's strongest expansion.
Saudi Arabia doubled its renewable power capacity in 2025 to more than 12,000 megawatts.
Turkey has roughly twice as much installed solar and wind capacity as Saudi Arabia, while the United Arab Emirates and Israel each have nearly 8,000 megawatts of renewable capacity.
Iran, meanwhile, has shifted from being a net electricity exporter to a net importer.
A decade ago, the country recorded a net electricity export surplus of around eight terawatt-hours. Last year, its electricity trade balance turned negative.
In recent months, Tehran has held talks with Turkmenistan to increase electricity imports and with Turkey to begin importing power from its western neighbour.
China's regional solar exports rebound
The collapse in Iran's solar panel imports contrasts with a rebound in Chinese shipments to several other Middle Eastern markets.
Chinese solar panel exports to a number of Arab countries initially declined by nearly half during the first eight months of 2026, but shipments to the broader region subsequently recovered.
According to a report by the China Chamber of Commerce in the UAE, citing Shanghai Metals Market data, China's photovoltaic module exports reached 23.92 gigawatts in September, up 44.2% from August.
Combined exports to Saudi Arabia, the United Arab Emirates and Turkey more than tripled in September to 3.97 gigawatts, with Saudi Arabia alone purchasing 2.9 gigawatts.
The figures suggest that Iran's sharp decline cannot be explained solely by a broader contraction in Chinese solar panel exports to the region, although the September rebound elsewhere does not establish the reasons for Iran's nine-month downturn.
With electricity shortages worsening and neighbouring countries accelerating renewable energy investment, Iran risks falling further behind at a time when expanding its power generation capacity has become increasingly urgent.