The European solar market slows to 65.5 GW of new installations in 2024, marking just a 4% growth compared to 2023. Explore the challenges and future outlook for solar energy in Europe and beyond.
What’s Happening to Solar Energy in Europe (and Italy)?
European solar power continues to grow, setting a new historical record in 2024. However, the rapid momentum seen at the beginning of the decade has started to wane. According to the EU Market Outlook for Solar Power by SolarPower Europe, the growth rate has slowed significantly—from 53% in 2023 to just 4% this year.
This deceleration seems puzzling given the sharp decline in photovoltaic module prices and reduced upfront installation costs. Specifically, average capital expenditures (CAPEX) for rooftop solar installations dropped by 2%, while ground-mounted systems saw a steeper reduction of 28%.
However, the trend is neither unexpected nor unprecedented. The slowdown is primarily driven by a decline in residential solar installations. As the peak of the energy crisis fades, government incentives and consumer enthusiasm for rooftop solar systems have diminished. Major EU markets like Germany and Italy reported significant drops in rooftop solar adoption. Meanwhile, modest growth in the commercial and industrial (C&I) segment and utility-scale solar installations has not been enough to offset these losses.
Broader Challenges Facing the European Solar Market
The market slowdown also reflects systemic barriers. SolarPower Europe notes, “The electrification rate in Europe has stalled at 23% over the past five years, leaving most of the energy system reliant on fossil fuels.”
Key Figures for European Solar Energy in 2024
- New Installations: 65.5 GW of photovoltaic capacity was installed in 2024, slightly surpassing the 2023 record of 62.8 GW.
- Total Capacity: The EU’s cumulative operational solar capacity now stands at 338 GW.
One notable trend is the diminishing dominance of traditional leaders. In 2014, Germany, Spain, Italy, the Netherlands, and France accounted for 87% of all EU solar installations. By 2024, their collective share has fallen to 69%. Here’s the breakdown of their national capacities:
- Germany: 99.2 GW
- Spain: 46.7 GW
- Italy: 36.2 GW
- Netherlands: 26 GW
- France: 23.5 GW
Solar Power Per Capita
When measured per capita, the Netherlands leads the EU with 1,467 W per person in 2024, reflecting a 13% annual growth. Germany follows with 1,192 W per person, driven by a 19% increase, while Austria ranks third with 1,013 W per person. Italy, however, does not appear in the top 10.
European Solar Projections for 2030
Looking ahead, SolarPower Europe’s medium scenario forecasts that the EU solar market is on track to meet the REPowerEU target of 750 GWDC (600 GWAC) by 2030. Under this scenario, the EU’s installed solar capacity could reach 816 GW by 2030, exceeding the European Commission’s target by 9%.
Yet, this projection represents an 8% (74 GW) reduction compared to mid-2024 estimates, signaling a downward trend. A further market slowdown could jeopardize the EU’s solar commitments.
In the low-growth scenario, total capacity is projected to reach only 644 GW by 2030—falling 14% short of the REPowerEU target. SolarPower Europe estimates that based on national energy and climate plans (PNECs), EU Member States will collectively achieve 687 GW by the end of the decade.
Factors Hindering Solar Market Growth in the EU
- Reduced Rooftop Solar Incentives: The end of the energy crisis and lower electricity prices have led to decreased government incentives, curbing residential solar installations.
- Grid Limitations: Network congestion, insufficient energy storage systems, and rising negative electricity prices deter investments in large-scale solar farms.
- Slow Economic Electrification: Industrial and transportation sectors are transitioning too slowly to electrification, limiting the demand for renewable solar energy.
- Bureaucratic Hurdles: Complex permitting processes and land access challenges hinder the development of new solar projects in many EU countries.
- Political Shifts: The rise of political parties less supportive of renewables in some European countries could slow the implementation of EU environmental policies.
Read the full report here.
