The United States is set to boost its solar module manufacturing capacity by 8.6 GW in the first quarter of 2025, according to the latest Solar Industry Update from the National Renewable Energy Laboratory (NREL). This report highlights key developments in the U.S. solar industry, including forecasts for manufacturing capacity, installations, and pricing trends.
U.S. Solar Manufacturing Capacity Expansion and Outlook
The U.S. is projected to add 8.6 GW of solar module manufacturing capacity in the first quarter of 2025, building on the 17.6 GW of capacity added in 2023. This rapid expansion is primarily driven by the incentives provided in the Inflation Reduction Act (IRA), which aims to increase domestic solar production.
By the end of 2025, the U.S. could have up to 74 GW of solar module manufacturing capacity, with a significant portion dedicated to exporting modules internationally. As of the first quarter of 2025, the U.S. had 44.9 GW of solar module manufacturing capacity, with 17.7 GW dedicated to crystalline silicon and 27.2 GW to thin-film modules. For more on global trends, see Global Solar Manufacturing Capacity to Reach 1.8 TW by 2025.
Solar Installations Driven by Increased Solar Manufacturing Capacity
The report also highlights a 29% year-over-year increase in solar installations, with 9.5 GW added in the first quarter of 2025. This growth is attributed to a decline in module prices, largely due to the expansion of U.S. manufacturing capacities and reduced import prices.
Utility-scale solar accounted for 4.4 GW, while the remaining 5.1 GW consisted of smaller-scale installations. The largest share of new capacity came from the Southwest region, which added 2.7 GW in the quarter. Additionally, the U.S. installed 2.3 GW of energy storage, with 95% of that capacity paired with solar projects. Notable solar projects include the 750 MW Madison Solar project in Ohio and the 300 MW Traverse Solar project in Texas. For more insights into U.S. solar growth, see U.S. solar capacity Reaches 50 GW in 2024: A Stunning Achievement.
Solar Pricing Trends Influenced by Solar Manufacturing Capacity Growth
The report indicates a decrease in solar pricing across different sectors. The average cost of residential solar fell by 4% to $3.35/W, utility-scale solar decreased by 9% to $1.24/W, and community-scale solar dropped by 7% to $2.08/W.
Despite the overall decline in prices, residential solar continued to experience volatility, with prices ranging from $1.77/W to $9.44/W. The decline in pricing is attributed to increased domestic production and lower import prices.
Module Imports and Exports Reflect Shifts in Solar Manufacturing Capacity
The report notes a significant shift in module imports and exports in the first quarter of 2025. The U.S. imported 9.3 GW of modules, a 23% decrease from the previous quarter and the lowest import volume since 2019. Meanwhile, module exports reached 6.1 GW, indicating a growing trend of U.S.-manufactured modules being shipped overseas. This trend is likely to continue as domestic production expands and manufacturers seek to capitalize on global demand.
Inflation Reduction Act’s Role in Boosting Solar Manufacturing Capacity
The Inflation Reduction Act has played a crucial role in driving the expansion of U.S. solar manufacturing. The incentives provided by the IRA have encouraged manufacturers to invest in new capacities, leading to a significant increase in domestic production. As a result, the U.S. solar industry is poised for continued growth, with a strong emphasis on both domestic and international markets.
The U.S. solar industry is experiencing rapid growth, driven by increased manufacturing capacity, rising installations, and declining prices. The latest NREL report highlights the significant impact of the Inflation Reduction Act on the industry, with forecasts indicating continued expansion in the coming years. As the U.S. continues to invest in solar energy, it is expected to play a leading role in the global transition to renewable energy. For additional global context, explore Global Solar Module Capacity to Reach 1.8 TW by 2025.