Solar Set to Power Half of New U.S. Electricity in 2025, EIA Projects

The U.S. is on track for a record-breaking year in solar energy, with developers expected to add 33 gigawatts (GW) of solar capacity in 2025, nearly half of all new electricity generation nationwide, according to the Energy Information Administration (EIA). If realized, this would mark the country’s largest-ever annual addition of large-scale solar power. Battery storage projects, which complement solar farms by storing excess energy, are also projected to hit record levels.

The surge in solar comes as states race to decarbonize their power grids and meet growing electricity demand from Big Tech and other expanding industries. Unlike fossil fuels, solar energy produces no greenhouse gas emissions, making it a cornerstone of climate and clean energy strategies.

Texas continues to lead the charge. After overtaking California in 2024 as the nation’s top solar state, the Lone Star State is set to add another 9.7 GW of solar this year, nearly half of all planned U.S. additions. Its abundant land, sunny climate, and rapidly rising power demand have made it the epicenter of the U.S. solar boom.

Still, uncertainty looms. Federal tax incentives that fueled solar’s rapid growth face rollback under the Trump administration, clouding long-term investment prospects.

33 GW of new solar capacity - nearly half of all new US electricity generation - combined with record battery-storage additions marks a genuine inflection point in US electricity-sector composition. Even under federal-policy pressure, market fundamentals continue to favour solar-plus-storage over alternative additions. Texas's 9.7 GW share (nearly half of national planned additions) reflects both resource endowment and rising demand.

The uncertainty around federal tax-credit rollbacks adds material risk to the medium-term investment case. Projects already under construction typically retain their incentive eligibility; new projects face materially different economics if credits are curtailed. State-level policies and corporate PPA demand remain the resilient demand base.

For solar developers, storage operators, industrial power buyers and financial institutions active in US clean-energy investment, Cognitud's market intelligence, responsible investment and energy transition teams help clients evaluate policy-risk exposure across federal and state jurisdictions, structure portfolios that reflect state-level economic resilience, and prepare disclosures aligned with TCFD, ISSB and jurisdictional frameworks that increasingly determine capital access in a volatile US policy environment.