Rome, July 2025 – Italy’s solar energy market is poised for significant expansion, with projections indicating that installed capacity will surge from 38.53 gigawatts (GW) in 2025 to 65.57 GW by 2030, reflecting a compound annual growth rate (CAGR) of 11.22%. This growth is fueled by a combination of rising electricity costs, strong government policies, and increasing corporate investments in large-scale solar projects.
Market Drivers: High Energy Costs and Energy Security Concerns
Italy has long grappled with some of the highest electricity prices in Europe, with residential consumers paying €0.319 per kilowatt-hour (kWh) in late 2022. This steep cost has accelerated the adoption of solar energy across residential, commercial, and industrial sectors. In 2021, renewables accounted for 43.32% of Italy’s total electricity mix, with solar playing a pivotal role.
The trend toward self-consumption has also gained traction, with solar PV systems generating 5,179 GWh of self-consumed electricity in 2021, representing 20.6% of total solar production. This shift underscores the growing preference for decentralized energy solutions among businesses and households seeking to reduce reliance on the grid.
Large-Scale Solar Projects and Agrivoltaics on the Rise
Italy is witnessing a surge in utility-scale solar projects, with agrivoltaics—a dual-use approach combining agriculture with solar power generation—emerging as a key trend. In March 2023, Enel Green Power began constructing Italy’s largest solar farm, a 170 MW agrivoltaic facility in Tarquinia, designed to optimize land use while supporting agricultural activities.
Other major developments include:
- Encavis AG’s framework agreement for a 300 MW solar project pipeline.
- Capital Dynamics’ acquisition of three solar PV projects.
- Edison’s €5 billion investment to expand its solar capacity to 6 GW by 2030.
Corporate Power Purchase Agreements (PPAs) are also gaining momentum. In September 2022, Sonnedix and Statkraft signed a 10-year PPA for 36 GWh of solar power annually, sourced from plants in central and northern Italy.
Government Policies Accelerating Solar Adoption
The Italian government has implemented a series of measures to accelerate solar deployment, including:
- A target of 70 GW of new renewable capacity by 2030, as announced by the Energy and Environment Ministry in February 2023.
- Simplified permitting for commercial rooftop solar (50-200 kW), allowing faster integration into Italy’s net metering (“Scambio sul posto”) scheme.
- Fiscal incentives for rooftop solar and energy efficiency in southern regions under the DL Energia decree (2023).
Additionally, Italy aligns with the EU’s mandate requiring solar installations on commercial/pvublic buildings by 2027 and residential buildings by 2029. The national energy strategy aims for 72-74 TWh of solar electricity by 2030, up from 27.55 GWh in 2022 (a 24.6% increase since 2016).
Investment Boom and Domestic Manufacturing Push
Italy’s solar sector is attracting substantial investments:
- Solarig and Alantra launched a €1.7 billion investment vehicle targeting 1.9 GW of solar PV, half of which will be in Italy.
- UniCredit and Enel partnered to expand a solar panel factory in Catania, boosting production from 200 MW to 3 GW annually.
Challenges and Future Outlook
Despite strong growth, Italy faces hurdles such as bureaucratic delays in permitting and land-use conflicts. However, the government’s push for faster approvals and innovative solutions like agrivoltaics is expected to mitigate these challenges.
With rising corporate PPAs, supportive policies, and technological advancements, Italy’s solar market is on track to become a European leader in renewable energy. The transition not only enhances energy security but also positions Italy as a key player in the EU’s green energy ambitions.