The global solar photovoltaic industry is approaching a historic turning point. According to the global solar market outlook report released by BloombergNEF (BNEF) on the 16th, due to policy adjustments and market saturation in key markets, global annual solar installations are projected to decline in 2026, marking the first annual contraction since records began in 2000.
Report data indicates that global annual solar capacity additions are expected to reach 649 gigawatts (GW) in 2026, slightly lower than the 2025 level. BNEF noted that growth in 2025 was already the weakest in the past seven years, and the subsequent contraction signals the industry’s formal entry into a phase of slower growth after years of rapid expansion.
Analysts suggest that although some emerging markets may maintain robust growth, it will not be enough to offset the overall market gap. Amid weakening demand prospects and pressure from “unprecedented manufacturing capacity and inventory,” prices across the supply chain are expected to remain at historically low levels before 2026, limiting the industry’s recovery potential.
In the report, BNEF forecasts that growth in the U.S. market will decelerate, primarily due to President Trump’s policy orientation aimed at restricting renewable energy deployment and revitalizing fossil fuels. Additionally, mature markets such as Spain and Brazil are showing signs of slowing growth, as rapid capacity expansion has led to increased curtailment and declining electricity prices, creating market uncertainties and dampening investment activities.
The reversal in supply-demand dynamics will continue to exert pressure on prices. Affected by weak demand prospects and “unprecedented manufacturing capacity and inventory,” prices across the entire solar supply chain will remain at historically low levels until 2026.
Taking the key upstream material polysilicon as an example, the industry faces significant challenges. Although industry consolidation efforts have driven a 50% recovery in Chinese polysilicon prices since June, overall prices remain low.
Despite the dim short-term outlook, the solar industry is expected to return to a growth trajectory as early as 2027. BNEF’s report indicates that as the U.S. adapts to the new supply-demand environment and new markets expand, global annual installations are projected to reach 688 GW in 2027, reflecting a “moderate” growth trend.
