US Solar Installations Decline in 2025 After Policy Changes Impact Renewable Sector

The pace of solar capacity additions in the United States slowed in 2025, reflecting policy changes and regulatory hurdles that disrupted momentum in the renewable energy sector, as per Reuters report. 

Solar Installations Fall in 2025 

According to a report by the Solar Energy Industries Association (SEIA) and Wood Mackenzie, the US solar market added 43 GW of new capacity in 2025, down from nearly 50 GW in 2024. 

As per the report, the slowdown to policy shifts under the administration of President Donald Trump, including the removal of subsidies and tax incentives previously available to renewable energy developers. 

The report also highlighted the impact of the administration’s One Big Beautiful Bill Act, which led to an industry-wide disruption. During 2025, utility-scale solar installations declined by 16%, while community solar installations dropped by 25%. 

Policy Shifts and Industry Challenges 

The sector has also faced additional pressures, including tariffs on equipment and a pause in approvals for large solar projects.  

These developments reflect a broader energy policy that places greater emphasis on oil, gas, coal and nuclear power, marking a shift from the renewable-focused agenda pursued during Joe Biden’s presidency. 

Despite the slowdown, solar power continues to play a major role in electricity generation expansion. The report noted that solar and energy storage together accounted for 79% of new capacity additions during the first year of the Trump administration. 

Demand for electricity from AI-focused data centres has also strengthened the economic competitiveness of solar power, the study said. 

Regional Trends and Future Outlook 

Among US states, Texas led solar expansion with 11 GW of new installations, followed by Indiana, Florida, Arizona, Ohio, Utah and Arkansas. More than two-thirds of the new installations occurred in states won by Trump, according to the report. 

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Conclusion 

The report estimates the United States could add 490 GW of new solar capacity by 2036, taking total installed solar capacity to nearly 770 GW despite the recent slowdown in installations. 

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