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EU Faces First Solar Market Decline Since 2015, Driven by Rooftop Collapse and Weakening PPAs

According to SolarPower Europe’s mid-year report, the EU is expected to install 64.2 GW of new solar capacity in 2025, down 1.4% from 2024—the first annual decline since 2015. The slowdown is mainly due to a sharp drop in residential rooftop installations, especially in Italy, the Netherlands, Austria, Belgium, Czechia, and Hungary, where declines of over 60% are expected. This comes after strong solar growth in 2022 and 2023 and flat growth in 2024.

The drop is linked to the end of government support schemes post-2022 energy crisis, policy instability, and reduced electricity prices, making rooftop solar less appealing to homeowners. Even in major markets like Germany, Spain, and Poland, installations are set to decline by over 40%.

On the other hand, utility-scale solar remains stable, contributing around half of new capacity. Auctions awarded a record 20 GW in 2024, led by Germany and the Netherlands. Hybrid solar-storage projects are gaining traction, offering grid flexibility.

However, the corporate PPA market has weakened, with a 41% drop in solar PPA volumes due to falling power prices. While the EU will meet its 2025 target of 402 GW, it risks missing the 2030 goal of 750 GW unless stronger policy support is introduced.