The solar EPC industry is poised for significant expansion over the next decade, supported by favorable policies, declining technology costs, and rising global demand for clean and secure energy.

According to a new report published by Allied Market Research, the global solar EPC industry size was valued at $0.4 trillion in 2024 and is projected to reach $1.2 trillion by 2034, growing at a robust CAGR of 11.9% from 2025 to 2034. This rapid expansion highlights the increasing importance of Engineering, Procurement, and Construction (EPC) services in accelerating solar energy deployment worldwide.

Understanding the Solar EPC Model

Solar EPC (Engineering, Procurement, and Construction) refers to a turnkey service model in which a single contractor manages a solar project from concept to commissioning. EPC contractors are responsible for system design and engineering, sourcing and supplying components, and executing construction, installation, and grid integration. In many cases, solar EPC services also include post-installation operations, maintenance, and performance monitoring.

This integrated approach ensures streamlined execution, technical consistency, regulatory compliance, and accountability throughout the project lifecycle. Solar EPC services are widely used across residential, commercial, industrial, and utility-scale solar projects, helping reduce risks for project owners while accelerating deployment timelines.

Regional Outlook

Region-wise, the solar EPC market is analyzed across North America, Europe, Asia-Pacific, and LAMEA. The Asia-Pacific region dominated the market with a 41.4% share in 2024 and is projected to grow at a CAGR of 12.3%. Strong government initiatives, large-scale solar projects, and rising electricity demand in countries such as China, India, and Southeast Asian nations are driving regional growth.
Key Drivers of the Solar EPC Market

The global solar EPC market is witnessing strong growth due to supportive government policies and financial incentives aimed at boosting renewable energy adoption. Subsidies, tax credits, renewable purchase obligations, and feed-in tariffs have made solar projects more economically attractive. For example, incentives such as investment tax credits (ITC) and long-term power purchase agreements (PPAs) significantly improve project viability and investor confidence.

Rising electricity prices and volatility in fossil fuel markets are further pushing businesses and consumers toward solar energy. Solar power offers a stable, long-term solution with predictable energy costs, making it an attractive alternative to conventional energy sources. Additionally, growing concerns over energy security and dependence on imported fuels are encouraging countries to expand domestic solar capacity, strengthening demand for solar EPC services.

Corporate sustainability commitments and net-zero targets are also playing a critical role. Commercial and industrial users are increasingly adopting on-site and off-site solar installations to reduce carbon emissions and operational costs, further driving solar EPC market growth.

Challenges Facing the Solar EPC Industry

Despite its strong growth outlook, the solar EPC market faces certain challenges. High upfront capital requirements remain a key restraint, particularly for small businesses and residential consumers. Although solar technology costs have declined significantly over the years, initial installation expenses can still be a barrier in price-sensitive markets.

Fluctuating raw material prices, especially for silicon, copper, and aluminum, can impact project budgets and timelines. Supply chain disruptions may lead to cost overruns or project delays, affecting EPC contractors' profitability. In addition, regulatory complexity poses another challenge. Solar projects often require multiple permits and approvals at local, state, and national levels, making compliance time-consuming and unpredictable.

Policy inconsistency across regions can create uncertainty for investors and developers, complicating financing and long-term planning for solar EPC projects.

Emerging Opportunities in the Solar EPC Market

The solar EPC market presents substantial growth opportunities, particularly in emerging economies across Asia-Pacific, Latin America, and Africa. These regions benefit from high solar irradiance, rapidly growing energy demand, and strong government support for renewable energy integration.
International funding, climate finance initiatives, and public-private partnerships are further improving project feasibility in these markets.

Technological innovation is another major growth catalyst. Continuous improvements in solar panel efficiency, inverter technology, and energy storage systems are enhancing project performance and reducing overall costs. Advances in manufacturing processes and materials are making solar power increasingly competitive with traditional energy sources.

Digitalization is also reshaping the solar EPC industry. The integration of artificial intelligence (AI), Internet of Things (IoT), and advanced analytics in project design, monitoring, and maintenance is improving efficiency, reliability, and asset performance. These technologies enable predictive maintenance, real-time performance tracking, and optimized energy generation, creating new growth avenues for EPC providers.

Solar EPC Market Segmentation Overview

The global solar EPC market is segmented by technology, installation type, size, end-use, and region.
By technology, the market is divided into photovoltaic (PV) solar and concentrated solar power (CSP). The photovoltaic segment dominated the market, accounting for 81.2% share in 2024, and is projected to grow at a CAGR of 12.0%, driven by declining PV costs and widespread adoption.

Based on installation type, the market is categorized into rooftop, ground-mounted, and floating solar systems. The rooftop segment held the highest revenue share in 2024 and is expected to grow at a CAGR of 12.1%, supported by increasing adoption in residential and commercial buildings.

By size, the market is segmented into small (up to 1 MW), medium (1-10 MW), and large (above 10 MW) projects. The small-scale segment is projected to grow at the fastest CAGR of 12.2%, driven by distributed generation and rooftop solar installations.

In terms of end-use, the commercial and industrial segment accounted for the highest market share and is projected to grow at a CAGR of 12.1%, as businesses increasingly invest in solar energy to lower costs and meet sustainability goals.

Competitive Landscape

The solar EPC market is highly competitive, with key players focusing on capacity expansion, technological innovation, and strategic partnerships. Major companies operating in the market include Jinko Solar, JA Solar, Hanwha Solutions, First Solar, Trina Solar, Larsen & Toubro, Canadian Solar, Yingli Green Energy, SolarEdge Technologies, and SunPower Corporation.