The U.S. solar industry added nearly 18 gigawatts (GW) of new capacity in the first half of 2025, underscoring its role as the backbone of America’s energy transition.
Despite this momentum, new federal policies under the Trump administration threaten to slow deployment and jeopardize long-term growth, according to the U.S. Solar Market Insight report by the Solar Energy Industries Association (SEIA) and Wood Mackenzie.
Solar and Storage Dominate New Power Capacity
In the first six months of 2025, solar and storage accounted for 82 percent of all new electricity capacity added to the U.S. grid. Demand was particularly strong in Republican-leaning states, with 77 percent of all new solar projects installed in Trump-won states, including Texas, Indiana, Arizona, and Florida.
Meanwhile, the U.S. solar manufacturing sector expanded with 13 GW of new module production capacity across facilities in Texas, Indiana, and Minnesota, raising total domestic manufacturing capacity to 55 GW.
Policy Headwinds Threaten Deployment
The report warns that the One Big Beautiful Bill Act (HR1) and recent executive actions could result in a loss of up to 55 GW of solar deployment by 2030, a 21 percent decline compared to pre-HR1 forecasts. Specifically, the Department of the Interior’s (DOI) new permitting rules are expected to stall around 44 GW of planned solar projects, particularly in Arizona, California, and Nevada.
“Solar and storage are the backbone of America’s energy future, delivering the majority of new power to the grid at the lowest cost,” said SEIA President and CEO Abigail Ross Hopper. “Instead of unleashing this American economic engine, the Trump administration is deliberately stifling investment, raising energy costs, and jeopardizing grid reliability.”
Rising Costs Add Pressure
A analysis prepared by Reuters noted that utility-scale solar costs rose 4 percent, residential system costs increased 2 percent, and commercial solar costs surged 10 percent in Q2 2025. These increases stem from higher permitting expenses, tariffs, and other federal restrictions, further challenging developers.
What’s at Stake for U.S. Energy and Jobs
The SEIA cautioned that restrictive federal actions could cost American jobs, increase electricity prices, and weaken U.S. competitiveness. Beyond energy security, stalled solar deployment could also undermine national ambitions in technology and artificial intelligence, which rely on abundant, reliable, and affordable power.
“Further uncertainty from federal policy actions is making the business environment for the solar industry incredibly challenging,” said Michelle Davis, head of solar research at Wood Mackenzie.
Outlook
While near-term solar deployment remains strong due to projects already underway and rising demand for power, the long-term forecast shows 4 percent lower installations by 2030 under current policy conditions. The SEIA has urged policymakers to reverse harmful measures and prioritize grid reliability, solar adoption, and clean energy manufacturing investment to keep the U.S. energy transition on track.
Baburajan Kizhakedath