Solar Industry Update: Q4 2025

We enter 2026 awaiting key policy determinations for the solar industry while also seeing signs of solar’s growth and strength in the US market. Electricity prices have been a major national conversation and renewable energy continues to rise to new expectations.

We’ve rounded up last quarter’s developments around policy changes, market growth, and electricity prices. All you need to know to start 2026 up to date.

Policy Changes (and TBDs)

“Wait and see” has been a major theme of Q4 2025. The OBBBA has impacted clean energy tax credits, and other changes are still to be determined. Decisions around tariffs, requirements for tax incentives, and government rules are all pending, adding extra complexity to solar development and manufacturing planning.

AD/CVD: possible retroactive duties and another ongoing investigation

The US Court of International Trade ruled in August that the Biden administration’s moratorium on solar panel tariffs during the Antidumping and Countervailing Duties (AD/CVD)  investigation was illegal. This has opened the possibility of retroactive duties being collected for panels imported between April 2022 and June 2024.

In September, a motion was granted to delay any retroactive tariff collection until a “final and conclusive judgment and the conclusion of all applicable appeals” is reached. In October, the Department of Commerce filed a federal appeal. Final decisions are likely to take another year or more. ¹

A new (different) AD/CVD investigation is underway for solar cells and panels imported from India, Indonesia and Laos. Preliminary CVD determinations for this investigation have been delayed since October. AD determinations were scheduled for December 2025. ²

Section 232: polysilicon imports investigation

An investigation into polysilicon imports under Section 232 is also ongoing. An affirmative finding, determining products are a threat to national security, would allow additional tariffs on pure polysilicon as well as products like silicon wafers, solar cells, and solar modules. ³

Foreign Entities of Concern (FEOC): guidance pending

The One Big Beautiful Bill Act imposed new FEOC restrictions on tax credits from the Inflation Reduction Act (specifically 45Y, 45X, and 48E tax credits). Official guidance from the Treasury Department is expected as soon as January 2026.

Companies are not waiting around for the details, an analysis from finance technology company Crux indicated more than 90% of clean energy developers and manufacturers have already initiated supply chain mapping, contract audits, and ownership reviews in anticipation of the new penalties for violating FEOC terms. ⁴

Greenhouse Gas Reduction Fund: legal review

A judge upheld the Environmental Protection Agency’s freeze on Greenhouse Gas Reduction Fund grants in September. (The GGRF was created by the IRA in 2022 but the funds were frozen by the EPA in March 2025.) The plaintiffs have requested a rehearing, which has been granted and is expected to take place in February 2026. 

The GGRF provided “nearly $27 billion in competitive grants to mobilize financing and leverage private capital for clean energy and climate projects that reduce pollution – with an emphasis on projects that benefit low-income and disadvantaged communities.” ⁵

Secretary Burgum’s signoff order: petition to revoke

Zero solar projects on federal lands have been approved since July when Interior Secretary Doug Burgum ordered all new decisions related to renewable energy must receive his personal signoff. Just one project had been approved since Trump took office in January 2025. (For comparison, 13 such solar projects were approved under the Biden administration.)

In December, nearly 150 US solar companies signed a letter asking the Trump administration to revoke the signoff policy. Wood Mackenzie has identified 18GW of affected projects that have been canceled or made inactive due to limited development progress in 2025. ⁶

Beginning of Construction: new rules

Requirements to establish Beginning of Construction changed in September. The 5% rule was eliminated for large projects. Projects larger than 1.5MW must now meet the Physical Work Test to safe harbor solar projects. 

Review this related blog post to ensure you’re prepared to meet either the July 4, 2026 Beginning Construction deadline or the December 31, 2027 Placed in Service deadline to qualify for IRA incentives like the ITC and Domestic Content tax credits.

New name, new mission?

The Trump administration renamed the National Renewable Energy Laboratory (NREL) in December. The Colorado-based research center is now known as the National Laboratory of the Rockies.

The Department of Energy says the name change signals a shift to a “broader applied energy mission.” It has not specified what this includes. ⁷

Areas of Growth

In spite of policy and market uncertainties, the US solar industry continued to push forward and even hit major milestones this quarter.

Domestic manufacturing milestone!

A major cause for celebration this quarter was Corning’s wafer manufacturing capacity coming online in late October. With this production, the US is now capable of manufacturing the entire PV supply chain domestically! Additionally, two new module manufacturing plants came online, bringing domestic module production capacity to 17.7GW. ⁸

Third-largest quarter in history for PV installations

In a nearly 50% increase over Q2, the US solar industry deployed 11.7GWdc in Q3 2025. PV solar has held onto its position as the leading source of new electricity capacity in the US, accounting for nearly 60% of all new capacity additions through the end of Q3 2025.

Energy storage continued to boom

Energy storage installations increased 31% year-over-year in Q3, with utility-scale deployments leading the growth. California and Texas represented 82% of total utility-scale storage deployment. Total energy storage deployment for quarters 1-3, 2025 was higher than all of 2024. ⁹

New Operations and Maintenance technology

Researchers have developed an automated algorithm to identify physical anomalies in solar energy systems. It is expected to improve the efficiency and effectiveness of O&M by detecting underperformance much earlier than is currently feasible. ¹⁰

Electricity Prices

The cost of electricity has been in the national spotlight and is likely to remain there as the US confronts exponentially rising demand for the first time in decades.

PJM capacity auction highlights energy shortfall

Consumers are starting to see the effects of skyrocketing energy demand in this age of datacenters and AI. PJM, which hit price caps in July’s capacity auction, hit those caps again in December. That auction (for 2027/2028) marked the first time the entire PJM region has fallen short of its reliability requirement. It missed that target by more than 5%.  

“This auction leaves no doubt that data centers’ demand for electricity continues to far outstrip new supply,” said Stu Bresler, PJM executive vice president for market services and strategy.

Nearly 5,100 MW of the 5,250 MW increase in PJM’s peak load forecast for 2027/2028 is attributable to data centers. ¹¹

Senators investigate data centers and rising prices

A handful of Democratic senators have launched an official investigation into the role of datacenters in rising electricity prices. ¹²

A Bloomberg News investigation of areas located near significant data center activity found electricity in those regions now costs up to 267% more than it did five years ago. Citing this statistic, the senators wrote, “To protect consumers, data centers must pay a greater share of the costs upfront for future energy usage and updates to the electrical grid provided specifically to accommodate data centers’ energy needs. ”They have requested information from executives at firms including Google and Amazon by January 12, 2026.

The market is finding hope in renewable energy

The US energy market continues to turn more and more to renewables to meet skyrocketing demand. This is perhaps made most clear by ERCOT’s transition to solar and storage. In a state known historically for its oil and gas ties, grid operators are choosing renewable energy to ensure residents have the power they need.

Battery storage facilities and solar farms account for nearly all 2025 capacity growth in Texas. Of more than 11,000MW of new capacity, solar power accounted for 4,500MW and battery storage 5,200MW. ¹³

Voters weigh in

Energy affordability has been a major issue in recent state elections. Candidates like Mikie Sherrill in New Jersey and Abigail Spanberger in Virginia focused their campaigns on lowering utility costs and won their races.

Our Response

Kinect Solar’s specialty is helping our partners and customers succeed in the changing market. In the current environment, we’re boosting success by providing on-demand warehousing for safe harboring projects or front-loading inventory. We’re also getting domestic content to clients who need it fast (we can ship immediately) and helping developers mitigate trade and tariff risks.

At RE+ Las Vegas in September, we heard both optimism and concern about the state of the industry. Our solar experts excel at finding new opportunities for your projects in a changing environment. Connect with us today to get your next possibility off the ground!