According to the U.S. Solar Market Insight 2025 report released by SEIA and Wood Mackenzie, new photovoltaic installation capacity in the United States reached 43.2GW(DC) in 2025, a 14% decrease compared to 50GW in 2024. Despite the year-over-year decline in installations, solar energy remained the largest source of new generating capacity added to the U.S. grid for the fifth consecutive year. Combined, solar and energy storage accounted for 79% of all new electric generating capacity added nationwide last year.
The installation decline was primarily concentrated in the utility-scale segment. The main reason: influenced by changes in tax credit deadline policies, developers tended to stockpile equipment to satisfy “Safe Harbor” provisions rather than directly advancing projects to Commercial Operation Date (COD).
Segment market performance is as follows:
Utility-scale: Total annual new installations reached 34.7GW(DC), a 16% decrease year-over-year. The fourth quarter alone saw a nearly 40% contraction compared to the previous quarter.
Residential solar: Affected by the early termination of Section 25D tax credit policies, installation volume decreased by 2% year-over-year, reaching 4.65GW(DC).
Commercial & Industrial solar: Benefiting from the continued grid connection of legacy projects under California’s NEM 2.0 (Net Energy Metering) policy, this segment bucked the trend with 6% growth, reaching 2.34GW(DC).
Community solar: Experienced a sharp 25% decline year-over-year, totaling only 1.43GW(DC).
It is noteworthy that seven states governed by the Republican Party, including Texas and Indiana, contributed over two-thirds of the new solar installations nationwide in 2025.
Wood Mackenzie analysts maintain a bullish long-term growth forecast, pointing out that solar energy offers faster deployment speeds compared to other power sources, making it well-suited to meet the surging electricity demand driven by data centers. In a baseline scenario, the U.S. is expected to add 490GW of new solar installations by 2036, with cumulative installed capacity projected to climb to nearly 770GW(DC).
On the manufacturing front, 2025 was a “milestone” year for the United States—module production capacity nationwide surged by over 50% year-over-year, increasing from 42.5GW at the end of 2024 to 65.5GW. According to SEIA statistics as of March 2026, the operational capacity of the U.S. domestic photovoltaic supply chain has reached: 66.6GW for modules, 3.2GW for cells, 5GW for wafers, 5GW for ingots, and 25GW (equivalent) for polysilicon.
However, the U.S. domestic market urgently needs policy certainty. This is particularly critical concerning the definition of “Foreign Entities of Concern (FEOC),” the Section 232 tariffs on polysilicon and its derivatives, and the Anti-Dumping/Countervailing Duty (AD/CVD) investigations targeting solar imports from Laos, Indonesia, and India.
