U.S. Solar Industry Expands with 8.6 GW Increase in Module Manufacturing Capacity

U.S. Adds 8.6 GW of Solar Module Manufacturing Capacity
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The U.S. solar industry has made significant strides, adding 8.6 gigawatts (GW) of new solar module manufacturing capacity in the first quarter of 2025. This achievement marks the third-largest quarterly increase in manufacturing capacity on record. The growth is attributed to the establishment of eight new or expanded factories located in Texas, Ohio, and Arizona. This information comes from the U.S. Solar Market Insight Q2 2025 report, released by the Solar Energy Industries Association (SEIA) and Wood Mackenzie.

In conjunction with the increase in module capacity, U.S. cell production capacity has also doubled to 2 GW in the first quarter, thanks to the opening of a new factory in South Carolina. The report indicates that the solar industry installed 10.8 GW of new electricity-generating capacity during this period, with solar and storage accounting for 82% of all new capacity added to the grid.

While the solar manufacturing sector continues to drive energy independence and growth in the U.S., concerns about new tariffs and potential changes to federal tax credits pose serious uncertainties for the industry, threatening its long-term sustainability. Abigail Ross Hopper, president and CEO of SEIA, emphasized, “Solar and storage continue to dominate America’s energy economy, adding more new capacity to the grid than any technology using increasingly American-made equipment. However, our success is at risk. If Congress fails to address the legislation passed by the House, which would make the energy tax incentives unusable, lawmakers will trigger a dangerous energy shortage, ultimately raising electric bills and halting America’s manufacturing boom. The Senate still has time to secure President Trump’s vision for American energy dominance.”

Uncertainties surrounding tariffs, including new anti-dumping and countervailing duties (AD/CVD) on cells and modules imported from Southeast Asia, along with potential changes in federal energy incentives, could significantly impede U.S. solar deployment and manufacturing. This situation may lead to energy shortages, job losses, and factory closures.

Zoë Gaston, Principal Analyst at Wood Mackenzie, commented, “The 10.8 GW of solar capacity installed in Q1 2025 represents a significant portion of new U.S. electricity generation, underscoring solar’s growing dominance in the energy mix. However, our analysis indicates that the U.S. solar market has not yet reached its full potential. Proposed changes to federal tax incentives, combined with ongoing tariff concerns, could drastically affect this growth trajectory and lead to energy supply challenges. It’s crucial to recognize the vital role of solar in America’s energy landscape.”

The forecast from SEIA and Wood Mackenzie, which factors in tariffs imposed in Q2 but does not account for potential rollbacks of federal tax credits, anticipates a decline in nationwide deployment. This could result in lost investment in local communities, energy shortfalls, and increased energy bills for American consumers. While the community solar forecast remains stable, all other segments have seen a decrease in their five-year outlook compared to the previous quarter, including a 14% reduction in projected residential solar deployment and a 6% reduction in utility-scale deployment. Any rollbacks of energy tax credits, coupled with recently imposed tariffs, would undoubtedly exacerbate the challenges faced by the solar industry.

According to the Solar Market Insight report, Texas continues to lead the country in solar capacity additions in Q1 2025, with Florida overtaking California for the second position. Among the top ten states with the highest installations in the first quarter, eight were states won by President Donald Trump in the 2024 election: Texas, Florida, Ohio, Indiana, Arizona, Wisconsin, Idaho, and Pennsylvania.

Founded in 1974, SEIA serves as the national trade association for the solar and solar + storage industries.