Expectancy of Increased Insolvencies in the Solar Sector by 2025
The solar industry is bracing for a market cleanup in the coming months, as market consolidation, decreased demand, and supply chain challenges take their toll.
According to Peter Knuth, chairman of the Federal Association of Solar Craftsmen (BDSH), the market cleanup is primarily caused by market-based pricing reforms in China, supply chain complexities, and shifts in capacity additions favoring certain high-growth regions like Texas.
Last year, solar energy reached a record with an increase of more than 16 gigawatts on rooftops and in large-scale solar parks. However, in the first half of 2025, around 7.1 gigawatts of solar installations were connected to the grid, which is almost 15% less than the previous year.
Knuth, who is also the CEO of Enerix, anticipates the continuation of market consolidation. He stated that many companies are hoping for orders for heat pumps as the demand for photovoltaics has significantly decreased. Knuth made these statements to the business magazine "Capital".
The decline is particularly significant for rooftop installations for private homeowners, as the market cleanup forces some providers to disappear. Knuth also mentioned that selling photovoltaic systems alone is no longer enough for many companies.
To manage these trends, the industry is focusing on battery storage and system flexibility, using surplus solar equipment for maintenance and replacements, and adjusting installation growth expectations to align with market realities.
The solar sector expects slowed growth in 2025, particularly in China, due to pricing reforms and market cleanup pressures. This indicates an industry recalibrating growth strategies to focus on replacement markets and grid integration solutions.
In summary, market cleanup in 2025 is driven by pricing reforms, component supply challenges, and maturation of the installed base, leading to a focus on replacement markets and grid integration solutions. The industry is managing these trends by leveraging surplus equipment, expanding storage capacities, and refining installation growth plans regionally and globally.
References:
- Rapid solar expansion continues in Texas
- Solar industry facing supply chain challenges
- Battery storage solutions for grid stability
- China’s market reforms slow solar growth
The solar industry is navigating market consolidation, driven by China's market reforms, supply chain challenges, and maturation of the installed base. With decreased demand for photovoltaics, companies are shifting their focus to battery storage, using surplus solar equipment for maintenance and replacements, and refining installation growth plans to align with global market realities, including potential opportunities in the finance and energy sectors.
