In 2025, the first decline in installed solar capacity in Europe since 2016 is anticipated, while uncertainties arise in the U.S. due to cuts in clean energy subsidies.
Trends in European Solar Energy
According to Solar Power Europe estimates, an additional 64.2 gigawatts of solar capacity is expected in 2025, a 1.4% decrease compared to last year. This marks the first annual decline since 2016, attributed to lower electricity prices and market saturation with installations. Home installations are slowing the most while large-scale solar farms continue to expand, facing challenges from diminished corporate offtake agreements.
Uncertainty for Clean Energy Projects in the U.S.
As reported, subsidy reductions in the U.S. have led to uncertainty for companies like Bila Solar and Heliene, who are reassessing their expansion plans. Two large offshore wind projects are also at risk of cancellation, highlighting challenges for clean energy in a shifting policy landscape. Advocacy organizations warn that recent changes threaten the U.S. clean energy trajectory.
Impact of Tax Legislation Changes on Solar and Wind Energy
Revised legislation accelerates the expiration of the investment tax credit for renewable energy projects. Altered deadlines for project commencement and operation create additional hurdles for developers. Funding issues and market uncertainty are putting pressure on numerous companies as they reevaluate their strategies and plans.
Amid global declines in demand for solar installations and uncertainties due to changing tax incentives, the future of solar and wind energy in Europe and the U.S. remains in question.
