Solar EPC Market Set to Reach $1.2 Trillion by 2034

The global market for Solar Engineering, Procurement, and Construction (EPC) services is forecast to nearly triple in size over the next decade, driven by supportive government policies, declining technology costs, and increasing corporate demand for clean energy solutions, according to a new report published by Allied Market Research.

The Solar EPC market, which includes end-to-end services for solar project development, was valued at $0.4 trillion in 2024 and could reach $1.2 trillion by 2034, registering a Compound Annual Growth Rate (CAGR) of 11.9 percent over the forecast period from 2025 to 2034.

The findings underscore the solar sector's expanding role in the global energy transition and its increasing maturity as a competitive power source. The growth projection is significant for the energy sector, as EPC firms are responsible for converting policy and financial commitments into operational solar assets, ranging from residential rooftop arrays to utility-scale farms.

Key Drivers and Market Segments

The primary drivers of this substantial growth include global climate commitments, such as national net-zero targets, and an aggressive push for renewable energy capacity. Government policies, including incentives, subsidies, and ambitious renewable energy targets in countries like India, are lowering the financial barriers to solar project development, according to the research firm.

Technological advancements, particularly in solar panel efficiency, coupled with falling module costs, are also contributing to the market's expansion. These factors are making large-scale solar installations more economically viable, enhancing their competitiveness against traditional energy sources.

The study segmented the market across technology, installation type, size, and end-use.

• Technology: The photovoltaic solar segment accounted for the largest revenue share in 2024, contributing to four-fifths of the global market revenue. This is attributed to PV’s scalability and cost-effectiveness, which positions it as a preferred solution for corporate carbon reduction and national energy transition efforts.

• End-Use: The commercial and industrial (C&I) segment was the largest in 2024, securing more than two-fifths of the market revenue. Businesses are increasingly adopting solar to manage rising electricity costs, ensure power predictability, and meet internal corporate sustainability goals.

• Installation Type: The rooftop segment held the largest share in 2024, accounting for more than half of the total revenue. Rooftop installations are becoming central to the decentralized power generation movement, providing clean power directly at the point of consumption for residential, commercial, and industrial users.

• Project Size: Medium-sized projects, defined as those between one to 10 megawatts (MW), represented the largest share by size in 2024. This size category serves as a middle ground for commercial and industrial consumers seeking substantial energy cost savings without the complex land acquisition and infrastructure challenges of massive utility-scale farms.

Regional Dynamics and Industry Challenges

Regionally, the Asia-Pacific market is poised to maintain its dominance and is projected to register the highest CAGR of 12.3% percent during the forecast period. The region's growth is supported by strong government policy frameworks, including incentives and feed-in tariffs in major economies like China, India, Japan, and Australia, paired with surging energy demand. States within India, such as Rajasthan and Gujarat, have emerged as key contributors to the nation’s overall solar capacity, highlighting local policy impact.

Despite the strong growth outlook, the Solar EPC market faces consistent challenges, primarily centered on regulatory and policy volatility. The report cited "regulatory uncertainty and policy inconsistencies" as a key restraint, noting that sudden changes in subsidy structures, import duties, or delays in land acquisition can disrupt project timelines and raise execution costs.

Additionally, the solar supply chain remains a point of vulnerability, largely due to a dependence on imports from a limited number of countries for critical components, particularly photovoltaic modules. Mitigating these risks, along with addressing a global shortage of skilled labor for project execution, will be crucial for the industry to realize the projected growth targets.

The forecast indicates that the solar energy sector's reliance on specialized EPC services—which offer turnkey solutions for system design, component procurement, and installation—will continue to expand as projects become larger and more technically complex, cementing the EPC market's critical position in the future energy landscape.

By Michael Kern for Oilprice.com

More Top Reads From Oilprice.com

• Russia’s Oil and Gas Revenues Set to Plunge by 35% in November

• NextDecade Seeks to Expand Further Rio Grande LNG Export Project

• Gulf Coast Pipeline Boom Marks Largest Natural Gas Expansion Since 2008

Oilprice Intelligence brings you the signals before they become front-page news. This is the same expert analysis read by veteran traders and political advisors. Get it free, twice a week, and you'll always know why the market is moving before everyone else.

You get the geopolitical intelligence, the hidden inventory data, and the market whispers that move billions - and we'll send you $389 in premium energy intelligence, on us, just for subscribing. Join 400,000+ readers today. Get access immediately by clicking here.