pwr_january-2025 - 17

2025 INDUSTRY FORECAST
Factors Affecting the Power
Industry in 2025 and Beyond:
Trump and Data Centers
Among Key Influences
The new year always provides a great opportunity to take a look back to see what
POWER got right (or wrong) in our previous industry forecast. More importantly,
it gives us a chance to look ahead.
Aaron Larson
S
ome things that happened in 2024
were easy to predict. For example,
record growth in solar power installations
was widely expected going into
the year, and the industry didn't disappoint.
Although the data has not been
finalized yet, the American Clean Power
Association (ACP) expects more than 32
GW of solar installations will be installed
in the U.S. in 2024, surpassing the previous
record set just a year earlier. The
exceptionally high installation total was
boosted by a requirement that modules
imported during the anti-circumvention
tariff moratorium be placed in service by
December 2024. ACP said installations
in 2025 will likely be 16% lower than in
2024, but it was optimistic that the market
will recover fairly quickly and experience
a 6.6% compound annual growth
rate (CAGR) through 2030.
Another big development that occurred
in 2024 revolved around artificial
intelligence (AI) and data centers. I
wouldn't say POWER got this wrong per
se, I just didn't address the topic in our
previous forecast. During the year, the
growth in AI platforms and usage, and
the projected expansion of data center
capacity needed to support the trend,
became a major focus of the power industry.
Tech companies including Microsoft,
Google, and Amazon began looking
to nuclear power to supply their data
centers, which was a welcome boost for
the nuclear power sector.
Yet, announcing plans to build plants
and actually commissioning units on time
and on budget are two separate things.
Many skeptics doubt that new nuclear
projects will meet aggressive cost and
schedule projections, and it's hard to argue
with the naysayers based on past hisJanuary
2025 |POWER
1. The Oberon Solar + Storage project, located in Riverside County, California, is a utility-scale
facility completed in November 2023. The site generates 679 MWp/500 MWac of solar energy
and also features 250 MW/1 GWh of co-located storage. Courtesy: Intersect Power
www.powermag.com
17
tory. Still, a lot of money is at stake both
from government and private sources, so
companies will be focused on delivering
successful projects in the years to come.
Prospects for Solar Continue to Shine
As previously
installations
mentioned, U.S. solar
are expected to decline
year over year, but that will have little
consequence on global solar growth.
BMI, a unit of Fitch Solutions, said in a
report published in late November that
it expects solar power to remain the
fastest-growing technology worldwide.
It predicted the average annual growth
rate for solar would be 12% from 2024 to
2033. Most of this growth is expected to
occur in the Asia-Pacific (APAC) region,
dominated by Mainland China followed
by India and Japan. BMI said APAC will
account for 74% of global solar capacity
additions during the period, with North
America and Western Europe accounting
for 18% of additions over the timeframe.
" Over the next decade, we expect solar
power to remain the largest growth technology
globally accounting for over 5,890
GW by 2033, " the report says.
The source of growth is expected to
shift in coming years, however. The report
says utility-scale projects (Figure 1)
will decline in prevalence over the next
decade, and growth in distributed solar
installations will be key to the industry's
continued dominance. " Policies like subsidies
and tax credits will boost distributed
solar adoption in large markets like
the U.S., China, and India, while emerging
regions like sub-Saharan Africa and
Latin America will also see distributed
solar growth to enhance energy security, "
the report says.
In a separate report focused on solar
investment opportunities, BMI called out

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