Solar Energy Market Size & Share Analysis - Growth Trends and Forecast (2026 - 2031)

Global Solar Energy Market Trends and Insights

Utility-Scale PV Cost Parity Accelerating Procurement in Asia

Benchmark auctions in India and China cleared below USD 0.03 per kilowatt-hour in 2024, undercutting legacy coal tariffs by up to 30%. Record annual additions of 330 GW in China and 18 GW in India in 2024 testify to this economics-driven surge. Provincial grid operators responded by fast-tracking ultra-high-voltage transmission corridors linking western resource hubs to eastern load centers. Southeast Asian planners canceled 12 GW of coal projects during 2024-2025 after levelized solar costs fell beneath regulated thermal power prices, further redirecting capital toward photovoltaic-battery hybrids.

IRA-Driven Domestic Manufacturing Boom in the United States

Section 45X production credits under the IRA provide USD 0.04 per watt for cells and USD 0.07 per watt for finished modules, tilting the cost curve toward local fabrication. By end-2024, U.S. module capacity quadrupled to 42 GW across 110 projects, and Qcells secured a USD 1.45 billion federal loan guarantee to develop America’s first fully integrated polysilicon-to-module line in more than a decade. First Solar enlarged its Ohio complex to 6 GW and broke ground on a 3.5 GW Alabama plant that leverages cadmium-telluride modules exempt from polysilicon bottlenecks. Although domestic polysilicon output met only one-quarter of 2024 module demand, front-loaded capital spending before the credit sunsets in 2032 should narrow this gap.

Corporate PPA Demand from AI & Data Centers in Europe & North America

Hyperscale operators executed more than 25 GW of solar PPAs in 2024 as artificial-intelligence workloads pushed data-center power use up by 40%. Microsoft’s 10.5 GW umbrella deal with Brookfield Asset Management and Google’s 2 GW Nevada-Texas build-to-transfer program illustrate a market pivot toward multi-gigawatt, multi-year offtakes that de-risk merchant exposure. Developers are now structuring hybrid solar-battery projects offering 24/7 matched supply to satisfy granular carbon-neutral targets, eclipsing interest in pure merchant photovoltaic capacity.^{[1]Brookfield Asset Management, “Microsoft and Brookfield Sign Record Renewable PPA,” brookfield.com}

Hybrid PV-Battery Projects Unlocking New Revenue Stacking Models

Hybrid plants reached 49 GW of PV paired with 11.1 GWh of batteries across 469 sites by end-2024. Co-located systems capture energy-arbitrage margins and frequency-regulation fees while trimming curtailment by 85% in high-penetration grids, according to laboratory field measurements.^{[2]National Renewable Energy Laboratory, “Hybrid PV-Battery Performance in High-Penetration Grids,” nrel.gov} In the United States, 72% of 2024 stationary-storage installations were associated with solar, reflecting the dual tax-credit structure that rewards integrated assets. Australia’s 300 MW Victorian Big Battery and Germany’s 2.5 GW Innovation Tender awards confirm that this stacked-revenue template is portable and bankable.

Supply-Chain Over-Reliance on Chinese Polysilicon & Wafers

China accounts for 80-90% of polysilicon and 95% of wafer output, with Xinjiang supplying 45% of global capacity. The Uyghur Forced Labor Prevention Act detained over 3,800 solar cargoes at U.S. ports through 2024, creating 8–12-week delivery delays.^{[3]U.S. Customs and Border Protection, “Uyghur Forced Labor Prevention Act Statistics,” cbp.gov} European tariff investigations followed in 2024, adding more uncertainty. Spot polysilicon prices collapsed from USD 35 per kg in 2022 to USD 6–8 per kg in 2024 as new Chinese capacity came online, crushing margins for many tier-one module makers. Western diversification efforts, including QCells’ Georgia polysilicon line and REC Silicon’s Washington restart, will still meet less than 15% of ex-China demand by 2027.

Grid Congestion & Curtailment in High-Penetration Provinces

National curtailment in China stayed near 3% in 2024, yet Xinjiang and Gansu exceeded 8% because transmission build-out lags generation. Spain curtailed 1,200 GWh of renewables in 2024 after interconnection permits in Andalusia and Extremadura stalled more than 5 GW of projects.^{[4]Red Eléctrica de España, “Renewable Curtailment 2024,” ree.es} In the U.S., California curtailed 2.4 million MWh of solar in 2024, and Texas queue wait times topped four years, pushing developers toward battery co-location to protect yields.

Segment Analysis

By Technology: PV Dominance Drives Innovation

Solar photovoltaic commanded 99.7% of the Solar Energy market share in 2025. Falling levelized costs, down 4.6% in 2024, place PV ahead of gas peakers and onshore wind in many regions. The segment is expected to grow at 19.92% CAGR through 2030, powered by efficiency gains such as perovskite-silicon tandem cells hitting 31.6% laboratory performance. Multi-junction designs could push conversion rates beyond 40%, opening space-constrained rooftops and vehicle-integrated niches. Concentrated Solar Power retained a marginal footprint because solar-plus-battery hybrids now achieve half its levelized cost in high-irradiance regions.

Silicon’s cost trajectory keeps eroding the addressable space for thermal tower and trough projects, though CSP still serves process-heat niches. The Solar Energy industry continues to funnel R&D toward wafer-thinning, metallization-free contacts, and back-contact architectures to inch efficiencies closer to 25% across mainstream product lines.

Note: Segment shares of all individual segments available upon report purchase

By Grid Type: Off-Grid Uptick in Emerging Regions

On-grid assets represented 89.3% of 2025 capacity, but off-grid systems are expected to expand at 22.2% CAGR to 2031 as governments target universal access. Kenya alone deployed 2.5 million pay-as-you-go kits by 2024, and Nigeria added more than 300 MW of solar mini-grids that bypass costly transmission extensions. Development-finance institutions extended USD 1.2 billion to mini-grid programs across 15 countries in 2024, with battery storage now standard for 24-hour supply. Rising electricity tariffs in parts of South Asia further tilt new capacity toward community-scale solar rather than diesel.

By End User: Residential Growth Hinges on Policy Certainty

Utility-scale projects held 52.9% of the 2025 market thanks to auction-driven procurement at costs below USD 0.03 per kWh. Residential installations, though battered by high rates in 2024, are still projected to achieve a 21.5% CAGR to 2031 as financing eases and self-consumption rules mature in emerging markets. Commercial and industrial rooftops showed resilience, growing 17% in 2024 because corporate buyers monetized both energy savings and renewable-certificate revenue streams.

Note: Segment shares of all individual segments available upon report purchase

Geography Analysis

Asia-Pacific retained 64.5% of installed capacity in 2025. China’s cumulative fleet surpassed 800 GW after adding 330 GW in 2024, with Shandong, Henan, and Jiangsu registering the highest provincial totals. India reached 90 GW, catalyzed by domestic manufacturing incentives that underwrote 40 GW of new factory commitments. Japan, South Korea, and Australia collectively added another 35 GW, with floating, agrivoltaic, and hybrid models compensating for land scarcity and grid bottlenecks.

The Middle East and Africa Solar Energy market is projected to register a 22.7% CAGR through 2031. Saudi Arabia’s 4 GW NEOM, the United Arab Emirates’ 2 GW Al Dhafra project, and Egypt’s 3.6 GW Suez Canal pipeline anchor this upswing, complemented by a surge in African off-grid kits that passed 5 million households by 2024.

North America installed 35 GW in 2024, dominated by 32 GW in the United States, where IRA incentives and state renewable portfolio standards converged. Texas led with 8.5 GW, while California followed at 6.2 GW despite rising curtailment. Canada’s 2.8 GW addition leaned on Alberta’s merchant market. Mexico’s progress stalled at 1.2 GW amid regulatory uncertainty.

Europe added 62 GW in 2024. Germany led with about 15 GW, Spain followed with nearly 9 GW but wrestled with interconnection backlogs, and Poland installed 6 GW driven by small-scale prosumers. The EU’s Net-Zero Industry Act set a target of 30 GW of localized manufacturing by 2030; however, only 8 GW of projects had broken ground by year-end 2024.