Policy Blow Today, Potential Boom Tomorrow – US Residential Solar’s Rocky Road Ahead

US Residential Solar May Drop 46% by 2030 Amid Tax Credit Phase-Out: Wood Mackenzie

The One Big Beautiful Bill Act (OBBBA), which phases out the Section 25D residential investment tax credit (ITC) after 2025, could slash US residential solar capacity by up to 46% by 2030, warns a new Wood Mackenzie report. The loss of this crucial tax credit will likely make solar installations less affordable, triggering market disruptions and potential company exits. “Many companies will not be able to stay in business,” said Zoe Gaston, Principal at Wood Mackenzie. Despite short-term headwinds, long-term prospects remain strong. By 2050, the total addressable residential solar market could reach 1,500 GW, with over 70 million homes considered viable for solar adoption. Even in a conservative scenario, 150 GW of new residential solar capacity could be added by 2050. Wood Mackenzie expects tech advancements and cost reductions to eventually revive growth.