Strong policy support for solar PV is driving the acceleration in capacity growth

Policy support remains a principal driver of solar PV deployment in the majority of the world. Various types of policy are behind the capacity growth, including auctions, feed-in tariffs, net-metering and contracts for difference.

Policy support remains a principal driver of solar PV deployment in the majority of the world. Various types of policy are behind the capacity growth, including auctions, feed-in tariffs, net-metering and contracts for difference. The following important policy and target changes affecting solar PV growth have been implemented in the past couple of years: 

China published its 14th Five-Year Plan for Renewable Energy in June 2022, which includes an ambitious target of 33% of electricity generation to come from renewables by 2025 (up from about 29% in 2021), including an 18% target for wind and solar technologies. 

In August 2022 the federal government of the United States introduced the IRA, which significantly expands support for renewable energy in the next 10 years through tax credits and other measures. 

In May 2022 the European Commission proposed to increase the European Union’s renewable energy target for 2030 to 45% as part of the REPowerEU Plan (which would require 1 236 GW of total installed renewable capacity, including 600 GW of solar PV). Many European countries have already expanded their solar PV support mechanisms in order to accelerate capacity growth with a view to the 2030 targets and in response to the energy crisis caused by Russia’s invasion of Ukraine. In addition, in February 2023 the Commission announced The Green Deal Industrial Plan, aiming to support the expansion of clean energy technology manufacturing, including solar PV.  

During COP26, held in November 2021, India announced new 2030 targets of 500 GW of total non-fossil power capacity and 50% renewable electricity generation share (more than double the 22% share in 2020), as well as net zero emissions by 2070, with solar PV being one of the main technologies used to achieve these goals.