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Key takeaways

The European solar energy market comprises businesses that engage in the manufacturing of photovoltaic equipment and components, project developers as well as providers of installation services for utility-scale and rooftop projects. While assets primarily focus on solar energy, a significant portion of identified assets also target other renewable energy generation methods (e.g. wind, biomass, thermal). We segmented the market into: (i) manufacturing, (ii) solar on land and (iii) solar on roof.


The broader global solar energy market is relatively fragmented. However, when focusing on the manufacturing segment, we see that Europe does not play a significant role in the global landscape, accounting for only ~1% of module output in 2021. Herein, China dominates the manufacturing segment, with 9 companies in the global top-10. Jinko Solar (CN), Trina Solar (CN) and LONGi (CN) are the global market leaders. This is primarily because of their cost leadership from scale advantages and low raw material prices, with low-cost Chinese solar module prices falling to ~€0.14/Wp in August 2023, compared to ~€0.22/Wp for mainstream and ~€0.31/Wp for high efficiency modules. The solar on land segment is less consolidated, primarily comprising private and public utility players and infrastructure investors. The solar installation services market has the most fragmented nature, primarily comprising local champions and SMEs.


Investor-led interest has been notable, with >50% of identified assets being sponsor-backed (as of November 2023). The solar on roof segment has seen the highest interest, with ~70% of identified players receiving financial backing (as of November 2023). We believe that the segment’s abundant buy-and-build potential and tailwinds from subsidies are the driving factor for interest in the segment. Overall interest in the solar energy market stems from underlying growth drivers, such as favourable regulation and a decreasing levelised cost of energy. However, the current high-interest environment making capital more expensive for project developers and the decrease in new build construction serve as detractors for investors.


ESG topics primarily relate to environmental and social topics. Players in the solar energy market positively contribute toward lowering CO2 emissions. Rooftop solar generates ~12x less CO2 than electricity from gas-powered plants and ~20x less than energy generated from coal. However, the adoption of solar power has far outpaced its recycling capacity. The primary social topic revolves around the impact of solar energy on energy prices. As solar power is generally cheaper than electricity generated from fossil fuels, this will increase purchasing power and overall quality of life for citizens. To ensure adherence to an ethical and sustainable supply chain, European incumbents follow the Solar Stewardship Initiative (SSI).

Company benchmarking

Market growth

Cumulative European PV capacity reached ~208.9GW in 2022 and is projected to grow to ~457.8GW by 2026 (+21.7% CAGR 2022-2026; Solar Power Europe, December 2022)

Solar PV installations in Europe were estimated at ~41.4GW in 2022 and are expected to reach ~53.4GW in 2023 and ~62.0GW in 2024 (Solar Power Europe, December 2022)

The International Energy Agency (November 2023) forecasts solar PV’s installed power capacity to surpass all other power sources (i.e. coal, natural gas, wind, hydropower and bioenergy) by 2027, accounting for ~22.2% of global energy capacity in 2027

Positive drivers

Continuous development of solar PV technology from reduced capital intensity, improved energy conversion rates, increased storage capacity and extended plant lifetimes, thereby leading to the constant decline of LCOE (interview by Gain.pro; International Energy Agency, November 2023; Solar Power Europe, June 2023)

Increase in power purchase agreements amongst corporates driven by their ESG-friendly positioning will further drive demand for solar power (interview by Gain.pro). At the same time, prices for these PPAs are increasing as energy prices remain high (e.g. UK PPA prices jumped ~30% in Q4 2022; Solar Power Portal, February 2023)

Simplification of government subsidies for consumer PV systems will further drive adoption by the EU population (European Commission, November 2023; Sunstyle, October 2022). Simultaneously, European governments are investing in further strengthening local development and manufacturing capabilities (Solar Alliance, July 2023)

Negative drivers

The outperforming solar adoption across the EU outpaces electricity grid improvements and the rollout of storage technologies (e.g. batteries), which could slow down incentivisation and adoption until these problems are negated (Politico, August 2023)

High and rising interest rates will likely lead to a decrease in large-scale solar projects, as players rely on external debt for ~80-90% of total financing. Higher interest rates lead to higher LCOE and investment costs, thereby pressuring returns (interview by Gain.pro)

Shortage of qualified personnel in Europe hampers total installation capacity, with the EU needing >1m solar workers by 2030 to meet higher renewable energy targets under its REPowerEU initiative (i.e. double solar capacity from ~320GW by 2025 and install ~600GW by 2030; Reuters, February 2023)

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