After beginning the year with two months of near continuous rain, solar power may seem an unlikely bet for Ireland. However, advances in technology mean that the sun is now a viable source of green power for this country.
The shift in Ireland’s solar energy landscape has been remarkable, says Yvonne McCarthy, head of sustainability research with AIB. “It’s now a real workhorse of our renewable energy mix. This level of growth may have been surprising five or six years ago, but now it’s not. Solar energy is surging globally and so Ireland’s rapid expansion is in keeping with this.”
According to Solar Ireland’s May 2025 figures, outputs increased by 49 per cent in the last year and by 160 per cent since 2023, with solar power now meeting the electricity needs of over 370,000 homes and preventing more than 395,000 tonnes of carbon emissions annually.
Innovation in solar photovoltaic (PV) technology means that today’s panels don’t need the sun to be shining; they can generate power from daylight, McCarthy says. “Solar is an important part of our new green energy mix – and an ideal companion to our wind capacity.”
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The key to unlocking the potential of solar was the Government’s decision to support this technology type through the Renewable Energy Support Scheme (RESS) and corporate appetite for renewable energy procurement, says David McElroy, partner, energy, infrastructure & natural resources, A&L Goodbody. “Prior to RESS, it was primarily onshore wind that benefited from Government support. Projects with fixed revenue streams located in jurisdictions with stable regulatory regimes and robust legal frameworks are going to attract investment.
“This has proven to be the case here, with the success of onshore wind now being replicated in the solar sector.”
The RESS scheme was central to really kick-starting the solar industry in Ireland, says McElroy. “For the first time it provided solar projects with a fixed income stream on which investors and developers could build the necessary project economics for this asset type. It also meant that these projects could source bank funding from traditional project finance and infrastructure lenders at low interest rates, which made investment in the sector compelling.”
The other aspect of the Irish energy market that has really served the solar industry well in its development has been the emergence of strong multinational corporate power purchasers, he explains. “These entities are, increasingly, looking for green power to meet their energy demands and solar developers and investors have been in a position to capitalise on that demand over the last few years.”
When it comes to the increasing use of solar energy, there are three factors driving adoption – cost, technology improvements, and changing consumer attitudes. McCarthy explains how, as solar prices have dropped massively, solar technology has improved hugely and continues to improve, and “we’re relatively good in Ireland at balancing variable renewable energy on our grid.
“In addition, Government policies have really helped with continued rooftop grants, the retention of zero per cent VAT on residential solar installations and the fact that you don’t have to have planning permission to install them.”
Appetite within the traditional bank funders of these projects has been strong, with robust competition between institutions to win mandates, says McElroy. “We see both domestic lenders and lenders across Europe and beyond participating in the Irish solar market, bringing their experience of solar projects from across Europe and applying it in an Irish context.
“In many instances, solar developers and investors have brought their relationship lenders with them when investing in Ireland, which has seen a healthy and competitive funding market emerge.”
Sustainable Ireland Special Report
- This year has been marked by war on multiple fronts, and a glaring lack of energy independence has become evident over a few short weeks. A green revolution, however, presses on: Ireland has made remarkable progress in solar generation, which is becoming an important presence in its energy mix, writes Kevin O’Sullivan, former editor of The Irish Times. Read more.
- In theory, it should be a slam dunk for electric buses to be cheaper to operate than diesel buses. If we were talking about private cars, then the maths is incredibly straightforward. When it comes to electric buses, however, the balance of cost seems less clear, writes Neil Briscoe, a contributor specialising in motoring. Read more.
- Trump’s anti-climate antics have led to many multinationals abandoning their sustainability commitments; however, Europe has no option but to push on with the green energy transition, writes Kevin O’Sullivan. Read more.
- As energy security concerns drive urgent demand for renewable gas, Ireland aims to scale biomethane by 2030; but policy, pricing and regulatory barriers must be resolved to unlock its potential, writes Edel Corrigan. Read more.
The legal and regulatory framework in Ireland is also very strong and provides a lot of comfort to investors and developers when choosing to deploy capital here, as it is extremely unlikely the basis for that deployment will shift.
Solar power is a key part of the energy mix along with other renewables like wind and conventional power such as gas, says McElroy. “According to Solar Ireland, it met a record-breaking 21.1 per cent of peak electricity demand in May 2025. It is a scalable, well-understood and economic means of producing power. Rooftop solar will also play a big part in this, giving both consumers and industry a direct means to control their energy costs.
“Having this diverse range of power generation sources strengthens the Irish energy sector, making it more resilient. This is especially important given the current macro-political environment and the inflationary effects on the economy as a result of constrained sources of traditional inputs for the production of power.”
