US Solar Sector Braces for Permitting Slowdown, Projecting Impact on 2026-2027 Capacity

Industry analyst Thomas Hochman recently expressed skepticism regarding the long-term sustainability of current US solar capacity growth, attributing present additions to projects permitted prior to this year. Hochman stated in a social media post, > "The capacity additions we’re seeing now are likely mostly projects that cleared major permitting before this year and thus avoided the political blockade." He further predicted, > "I'd expect to see the effect of the admin's permitting actions wrt solar show up more in '26 and '27."

This perspective emerges despite the US solar industry experiencing a record-breaking year in 2024, with nearly 50 gigawatts direct current (GWdc) of capacity installed, marking a 21% increase from 2023. This surge, largely propelled by the Inflation Reduction Act (IRA) incentives, made solar account for 66% of all new electricity-generating capacity added to the US grid that year, according to the Solar Energy Industries Association (SEIA) and Wood Mackenzie.

However, recent federal actions, particularly executive orders issued in early 2025, are anticipated to introduce significant headwinds. Deloitte's 2025 Renewable Energy Industry Outlook and SEIA reports highlight that President Trump's administration declared an energy emergency and halted the issuance of key permits for renewable energy projects on federal lands for 60 days. These measures prioritize thermal and hydropower generation, potentially slowing approvals for utility-scale solar plants.

The SEIA's Q1 2025 report explicitly noted that "The US solar industry also faces significant challenges due to recent federal actions, including proposed changes to tax credits... and a shift in energy priorities towards fossil fuels." This creates an "uncertain environment for solar growth in the coming years," reinforcing concerns about project delays and cancellations, particularly in the utility-scale segment, as developers adapt to new regulatory landscapes.

While a November 2025 SolarQuarter report indicated a downward trend in overall project delays for utility-scale solar, suggesting improved project management, it also acknowledged that ambitious future plans include projects that have already pushed their online dates. The cumulative impact of policy shifts and permitting challenges is expected to become more pronounced, potentially affecting the pace of new solar installations in 2026 and 2027 as initially permitted projects are completed and new ones face heightened scrutiny.