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

Global Solar Photovoltaic (PV) Market Trends and Insights

Falling Module ASPs Widen Grid-Parity Zones

Spot prices dropped to USD 0.082 per watt-peak FOB China in July 2025, a 32% fall from early 2024. The decrease expanded grid-parity to 142 nations where utility-scale solar now undercuts coal and gas generation by 15–25%. Market consolidation accelerated as the five largest suppliers controlled 68% of 2025 shipments. Regulatory efficiency thresholds of 21% for utility projects and 19% for rooftop systems safeguard performance standards. Developers responded by integrating module production and EPC services to recapture margin. Forward price curves suggest another 10–15% decline by 2027 as N-type TOPCon technology achieves manufacturing parity with PERC.

IRA-Driven On-Shoring of PV Manufacturing in the U.S.

Section 45X credits of USD 0.07 per watt-dc for modules and USD 0.04 per watt-dc for cells spurred USD 10 billion of factory announcements through 2025. First Solar’s Louisiana plant adds 3.5 GW of thin-film output in 2026. Domestic module production reached 12 GW dc in 2024, yet satisfied only 8% of local demand. Treasury guidance now requires 55% U.S. cost content by 2027 to qualify for the full 30% investment tax credit. Vertically integrated supply chains cut lead times to eight weeks and slashed freight costs by 40% for East Coast projects.

AI-Enabled Solar Forecasting Cuts Balancing Costs

Machine-learning models lowered day-ahead forecast errors below 5% for California ISO in 2025, saving USD 8–12 per MWh in ancillary-service expenses.^{[1]National Renewable Energy Laboratory, “Utility-Scale Solar Grid Parity Expansion,” nrel.gov} Google DeepMind’s work with National Grid ESO attained 92% prediction accuracy 36 hours ahead and deferred USD 200 million in spin-reserve investments. ERCOT integrated real-time forecasting into nodal prices and lifted market-clearing efficiency by 22%. Software licensing costs of USD 0.003–0.005 per watt-dc equal under 1% of project capex and deliver IRRs above 25%.

Demand From Green-Hydrogen Electrolyzer Projects

International Energy Agency modeling shows that 38 million tpa green-hydrogen capacity by 2030 will need 250–300 GW of dedicated solar.^{[2]International Energy Agency, “Hydrogen 2025 Report,” iea.org} Saudi Arabia’s NEOM hub integrates 4 GW of renewables and ships 1.2 million tpa ammonia from 2026. Electrolyzer capex fell from USD 1,200 per kW in 2023 to USD 850 per kW in 2025, enabling merchant projects below USD 3 per kg of hydrogen. EU REPowerEU goals and ISO 14687 certification protocols further lift procurement in Spain, Portugal, and Greece.

Grid-Congestion & Curtailment Risks in High-Penetration Regions

California curtailed 2.6 million MWh of renewable electricity in 2023, equal to 385,000 homes’ annual use.^{[3]California ISO, “2023 Annual Curtailment Report,” caiso.com} Evening ramps increase gas-peaker cycling costs by USD 15–20 per MWh. ERCOT foresees 4 million MWh of curtailment each year by 2028 as West-Texas solar surpasses transmission capacity. Germany paid EUR 1.2 billion to compensate curtailed generators in 2024. South Australia imposed dynamic export limits on rooftop systems, cutting household feed-in revenue 12–18%. U.S. interconnection queues above 2,000 GW stretch upgrade timelines to a decade, pushing developers toward behind-the-meter installations.

Rapid Polysilicon Price Swings Squeeze Producer Margins

Prices climbed 35% between Q1 and November 2025 to USD 8.40 per kg after Xinjiang plant outages and export controls. Gross margins at non-integrated module makers fell to 9%, forcing Yingli and Suntech to idle lines. Vertically integrated leaders maintained 14–16% margins by securing in-house feedstock. New U.S. countervailing duties of 2.85–39.37% on Southeast-Asian imports increased landed prices by up to USD 0.04 per watt-peak.^{[4]U.S. Department of Commerce, “Preliminary Solar Countervailing Duties,” commerce.gov} Futures contracts on the Shanghai exchange now hedge polysilicon exposure for 28% of global shipments.

Segment Analysis

By Technology: N-Type Architectures Challenge PERC Dominance

Monocrystalline silicon maintained 86.1% solar panels market share in 2025 as cell efficiencies reached 27.81%. The solar panels market size for advanced tandem and perovskite modules is forecast to grow at 31.1% CAGR through 2031, reflecting Oxford PV’s 24.5% commercial products and 10,000-hour stability milestones. Multicrystalline declined to 8.2% as producers migrated toward N-type TOPCon and heterojunction lines that lift performance by 1.5–2 percentage points at comparable costs.

Investment in R&D topped USD 1.2 billion among leading firms in 2025, focusing on bifacial, half-cut, and multi-bus-bar layouts that push 600 W-plus panel ratings. Thin-film cadmium-telluride retained a 4.9% share, favored for hot-climate utility sites where lower temperature coefficients elevate annual energy yield 3-5%. Bankability hinges on IEC 61215 and IEC 61730 compliance, which underpins financing terms and lowers debt margins by up to 50 basis points.

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

By Deployment Type: Floating PV Gains Traction in Land-Constrained Markets

Ground-mounted arrays represented 75.5% of installations in 2025, with project capex falling to USD 0.75–0.95 per watt-dc. The solar panels market size allocated to floating photovoltaic systems is poised for a 30.5% CAGR run as China, India, and Singapore prioritize water-body utilization. India’s 100 MW Ramagundam plant delivered 5–10% higher output thanks to evaporative cooling.

Singapore’s Tengeh Reservoir system covers 60 MW and curbs annual water loss by 1.2 million m³. ASEAN nations now integrate floating PV with hydropower reservoirs to smooth seasonal flows and maximize transmission usage, with 12 schemes totaling 1.8 GW underway. Rooftop and building-integrated systems held an 18.3% share in 2025 but face tariff revisions such as California’s NEM 3.0, which cut export credits by 75% and shifted economics toward self-consumption tied to battery storage.

By End-User: Residential Upswing Offsets Utility-Scale Maturity

Utility-scale independent power producers dominated demand at 63.2% in 2025, anchored by 15–25-year power purchase agreements and levelized energy costs below USD 0.03 per kWh in high-irradiance zones. The solar panels market size for residential buyers is projected to expand at a 22.7% CAGR through 2031, buoyed by the 30% U.S. investment tax credit extension and rising retail electricity rates that compressed payback periods to six to eight years.

Commercial and industrial users claimed a 14.6% share in 2025, lagging behind-the-meter arrays of 100 kW–5 MW to hedge time-of-use tariffs. Germany nullified VAT on systems below 30 kW, lifting household installations 38% year on year. India disbursed INR 18,000 crore in rooftop subsidies but reached only 11 GW of cumulative capacity due to interconnection hurdles. Corporate offtakers now specify 24/7 matching that necessitates storage additions of USD 0.25–0.40 per watt-dc yet secures Scope 2 emission cuts exceeding 90%.

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

Geography Analysis

Asia-Pacific closed 2025 with 64.3% of global installed capacity, driven by China’s 210 GW of new projects and India’s 85 GW cumulative base. Japan’s feed-in tariff step-down slowed rooftop growth, but corporate PPAs advanced 62% as LNG volatility spurred interest in price stability. ASEAN markets added 18 GW thanks to concessional finance that trimmed debt premiums 30–40 basis points. Australia’s household penetration reached 38%, yet dynamic export caps in high-renewables states redirected capital toward utility-scale solar-plus-storage.

The Middle East and Africa are set for a 21.5% CAGR, supported by Saudi Arabia’s 58.7 GW Vision 2030 roadmap and the UAE’s 5 GW Dubai park expansion. Saudi Arabia’s 1.5 GW Sudair plant achieved a record USD 0.0104 per kWh bid price. The UAE’s Noor Abu Dhabi now covers 10% of local demand and exports into the Gulf interconnector. South Africa awarded 3.2 GW in Bid Window 6 but postponed 1.8 GW due to grid constraints. Nigeria deployed 450 MW of mini-grids in 2025, extending service to 2.8 million people.

North America accounted for 12.8% of 2025 capacity. The United States added 32 GW, with Texas surpassing California in annual additions. Canada’s 30% clean-electricity tax credit stimulated 2.5 GW across Alberta and Ontario. Mexican rooftop deployment slowed amid net-metering uncertainty. Europe captured a 9.4% share; Germany installed 8.5 GW and Spain 6.2 GW under carbon-price pressures near EUR 90 per t CO₂. Brazil’s distributed-generation base hit 18 GW in 2025, retaining full retail credit for exports.