Europe is forecast to add 110GW of new solar PV capacity in 2025, according to Liam Coman, solar market analyst at S&P Global Commodity Insights.
During a keynote presentation at Tongwei’s new European office event in Frankfurt, Germany, Coman added that the growth of solar PV in Europe would fall to single-digit rates after 2026. “In three years the market will grow from about a 50GW market to a 110GW market in 2025, more than doubling in just three years,” he said.
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These numbers would nearly double the installed capacity registered in 2023, when Europe added a record 56GW of solar PV, according to trade association SolarPowerEurope’s (SPE) yearly report on the European market, which covers the 27 EU member states. It is also a big increase on SPE’s forecast for 2024, which sits at 62GW, while S&P numbers are closer to 100GW for this year (95GW) for the whole of the European continent. It is worth noting that SPE’s forecast was made in December 2023.
Key markets for the growth of solar PV in the past few years were Germany, Eastern Europe, Spain and Italy, said Coman. These markets accounted for nearly half of the total installed capacity in Europe.
Despite this accelerated growth at the beginning of the decade, the second half of the 2020s will see its growth rate slow down, explained Coman. This is due to the ever increasing challenge of grid interconnection, as covered previously on PV Tech, with more investment needed in the grid for solar PV to maintain its growth. “The number one thing that we need to do is invest in the grid,” said Coman.
He explained that another challenge for European markets is the low and volatile power pricing in the recent months, which will affect utility-scale market in the future. By the end of the decade, the European market is forecast to add 130GW of installed capacity annually.
Even though the utility-scale might look more challenging in the second half of this decade, Coman said the rooftop market will see strong and consistent growth in the coming years, “growing from about a 60GW market in 2024 up to an 85GW market by 2030.”
Global installs to reach 580GW in 2025
Speaking of global trends, Coman said that S&P forecasts global solar installations to reach 580GW in 2025, a significant contrast with BloombergNEF’s recent forecast which has global installations for this year at nearly 600GW. “We do see growth slowing somewhat in 2025 to a 7% growth rate,” added Coman.
That growth is primarily driven by China, which in the last couple of years doubled its installed PV capacity and in 2023 added the same amount as the entire global market in 2022. This is not to say that other markets have not seen a growth in PV capacity additions since the beginning of the decade. Coman explained that between 2021 and 2024, the number of annual gigawatt-scale markets has increased from 16 to 45, nearly trebling in the span of three years. “What we’re seeing is a broadening out of where solar is being installed,” he said.
In Europe alone this year, three markets – Romania, Lithuania and Ireland – will see, for the first time, over 1GW of solar capacity added in a single year. Malaysia, Uzbekistan and Iran will also install more than 1GW of PV capacity either this year or the next.
“While mature markets are going to keep high levels of installation in the coming years, it’s really these growth markets that we need to look to to drive the solar market forward in the coming years,” explained Coman, adding that growth will happen in Europe and Asia, excluding China, in the coming years throguh untapped markets with further growth for solar PV.
Moreover, Coman said that the gap between supply and demand – the ongoing oversupply within the solar industry – will reduce in 2025 but will“remain in the market over the coming years” adding that prices will stabilise in the next few years.
Updated on 13.11.2024 to clarify that S&P numbers are for Europe as a continent.
