Solar Slowdown: Spain Faces Rooftop Installation Decline

Spanish households and companies installed fewer rooftop solar systems last year due to the withdrawal of tax deductions, resulting in a decline after previous growth driven by subsidies. Inflation and lower energy prices further impacted installations, with smaller systems experiencing the greatest drop.

Spain's solar industry is experiencing a downturn in rooftop installations following the removal of key tax deductions, industry group UNEF reported on Thursday. The sector reached a total installed capacity of 9.3 gigawatts as installation rates slowed in 2025, echoing the end of a growth spurt seen in 2022, fueled by generous subsidies.

The waning impact of subsidies led to fewer new installations, exacerbated by inflation affecting household budgets and decreasing energy prices, which reduced incentives to cover initial costs. Last year, 1,139 megawatts of new rooftop capacity were added, marking a 3.7% decrease from 2024.

The decline was mostly seen in smaller domestic systems, which fell by 17%, while industrial users slightly increased capacity by 0.7% over the previous year. UNEF emphasized the importance of fiscal incentives, regulatory changes, and support for shared solar projects to sustain the sector's momentum.

(With inputs from agencies.)