EU solar energy deployment declines for the first time in a decade due to subsidy cuts

Industry data revealed on Thursday that the European Union's solar energy expansion is set to experience its first annual decline in over a decade as some governments cut subsidies for rooftop panels.

This trend is a reflection of the shifting priorities in Europe, as some countries have reduced their support for green energy or measures to reduce pollution from budgets that are already stretched due to spending on local industries and defence.

SolarPower Europe, an industry association, said that the EU is on course to install 64.2 Gigawatts (GW) of new solar power capacity by 2025. This represents a decrease of 1.4% compared to the 65.1 GW installed in 2018.

This would be the first year since 2015 that Europe's solar market growth has slowed. It would dent an area where Europe is making rapid progress on its shift to clean energy. Solar capacity growth will soar by 51% between 2023 and 2025, even though growth last year was only 3%.

Solar generated 22% last month of the total electricity in EU, making it that month's biggest single source of energy generation.

SolarPower Europe has estimated that the EU needs 750GW by 2030 to meet its climate targets, and phase out Russian energy. But the current rate of deployment indicates the EU will be short by around 27GW.

The primary cause of this downturn is the decrease in residential rooftop solar panels installations. This sector is expected to account for 15% of new capacity by the end of this year. Its share of roughly 30% from 2020 to 2023 will be halved.

Germany and France have reduced their feed-in rates for rooftop solar power, while the Netherlands has also cut support for households who export excess solar power into the grid. (Reporting and editing by David Holmes; Kate Abnett)

(source: Reuters)