Austria’s solar energy sector experienced a notable cooling period in 2025, as new installations dropped to approximately 1,634 MW. This figure marks a 22% decline from the capacity added in 2024 and remains well below the record-setting 2,474 MW achieved in 2023. By the end of December 2025, the country’s cumulative photovoltaic capacity reached nearly 9.9 GW. This slowdown poses a significant challenge to Austria’s target of achieving a 100% renewable electricity supply by 2030, a goal that requires a consistent annual addition of at least 2 GW.
According to the latest data from the national energy regulator, E-Control, the downward trend in the Austrian market is becoming more pronounced. Vera Immitzer, Managing Director of PV Austria, noted during a recent press conference that the industry is struggling to maintain the momentum seen in previous years. Projections for 2026 are equally cautious, with experts predicting that new installations will likely remain at 2025 levels, failing to reach the critical 2,000 MW mark required for the energy transition.
Industry experts attribute much of this decline to shifting domestic political signals. A primary concern is the early abolition of the VAT exemption for small-scale rooftop solar panel systems by the current government. This policy change has reportedly dampened interest among private households and created a climate of uncertainty for investors. Christoph Mair, a representative from the installation firm MEA Solar, criticized the government’s “stop-and-go” approach, stating that short-term regulatory shifts make it difficult for installation companies to plan consistently while facing rising costs for components.
The reliance on government subsidy programs has also introduced administrative hurdles. Following the removal of the VAT exemption, these funding initiatives have become the primary driver for rooftop demand. However, the infrequent scheduling of these programs—with the most recent closing in late 2025 and the next not opening until April 2026—leaves the market in a state of flux.
Beyond policy concerns, technical and infrastructural barriers are hindering the deployment of larger solar module projects. Grid expansion is not keeping pace with generation capacity, leading to situations where certain regions cannot accommodate new full-feed-in installations. To combat this, industry leaders are calling for an urgent focus on battery storage integration.
While there is high interest in retrofitting existing systems with storage, advocates say the current framework is insufficient. They are calling for simplified permitting processes, standardized regulations, and proportionate fire safety measures to ensure that storage remains affordable and accessible. Furthermore, experts suggest that the introduction of dynamic electricity tariffs and revised grid fees could incentivize the thousands of existing storage owners to use their systems in a way that provides better support to the national grid.