Australia rooftop solar market is experiencing robust growth, propelled by strong policy support and the growing need for decentralized energy solutions. According to IMARC Group, the market size reached USD 1,528.1 Million in 2025 and is projected to reach USD 2,654.1 Million by 2034, registering a healthy compound annual growth rate (CAGR) of 6.14% from 2026 to 2034.
Strategically, the Australia rooftop solar market is vital to the nation's clean energy transition, enhancing energy security, reducing household electricity costs, and supporting the decarbonization of the electricity grid. In 2024-25, Australian households saved about A$3 billion ($2.18 billion), or A$125 per capita, on electricity costs by installing rooftop solar. With cumulative rooftop solar capacity reaching 29.1 GW and over 4.3 million homes now equipped with solar panels, Australia remains a global leader in rooftop solar adoption.
*The Australia rooftop solar market is poised for steady expansion from USD 1,528.1 Million to USD 2,654.1 Million by 2034, growing at a 6.14% CAGR, supported by strong policy backing, state-level incentives, and the integration of advanced grid technologies. With over four million homes already powered by rooftop solar and the Solar Sharer scheme set to provide free electricity to households from 2026, the industry presents compelling investment opportunities across all major Australian regions.*
Key Trends Shaping the Australia Rooftop Solar Market
Grid Constraints and Decentralized Energy Needs
With energy needs increasing in cities and grid reliability remaining uneven in remote communities, rooftop solar provides a decentralized alternative to alleviate strain on the main network. Creating energy at the location of utilization minimizes transmission losses and alleviates peak load strain. To handle this transition successfully, utilities are putting money into cutting-edge grid technologies that enable real-time interaction between distributed energy sources and the primary grid. In 2024, Itron and Jemena collaborated to launch a Low Voltage Distributed Energy Resource Management System (LV DERMS) in Australia, offering real-time information and remote-control features to align rooftop solar contributions with grid requirements, guaranteeing stability and efficiency. Such initiatives indicate a wider trend among energy suppliers to view rooftop solar not merely as a user product but as an essential part of grid infrastructure.
Policy Backing and State-Level Incentives
The Australia rooftop solar market growth is tied to steady policy commitments at both federal and state levels, which is making solar systems financially viable and widely accessible. Programs like the small-scale renewable energy scheme (SRES), along with state-specific rebates, net metering rules, and favorable feed-in tariffs, have collectively shortened payback periods and enhanced return on investment for individuals. These measures not only incentivize system installation but also promote long-term engagement in distributed energy generation and trading. Importantly, government targets and clear renewable energy timelines provide a sense of stability that boosts user and installer confidence. In 2024, the state of Victoria launched a roadmap aiming to install 7.6 GW of solar by 2035, including 6.3 GW rooftop, 1.2 GW distributed, and 3 GW utility-scale solar, directly aiding the state's wider objective of 95% renewable energy by 2035.
Rooftop Solar and Battery Integration
The integration of rooftop solar with battery storage is emerging as a significant trend, as households seek to maximize self-consumption and energy independence. In 2025, home battery installations topped 4.3 GWh, reflecting growing consumer demand for energy storage solutions that complement rooftop solar systems. The combination of solar and storage enables households to store excess daytime generation for evening use, reducing reliance on the grid and maximizing savings. This trend is expected to accelerate as battery costs continue to decline and as new schemes, such as the Solar Sharer scheme launching in July 2026, provide additional incentives for households to adopt solar-plus-storage solutions.
Residential Average System Size Growth
Australian households are increasingly opting for larger rooftop solar systems to maximize energy generation and savings. Residential installations averaged 10.2 kW in the first half of 2025, reflecting a trend toward bigger, more powerful systems. This shift is driven by falling panel costs, the desire to power electric vehicles and heat pumps, and the growing availability of financing options that make larger systems more accessible. The 20-30 kW segment has emerged as a standout performer, delivering almost double the installed capacity compared to previous months.
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Market Growth Drivers
The Australia rooftop solar market is propelled by several robust demand drivers that collectively support sustained expansion through 2034:
Strong Policy Support and Government Incentives: The federal government's small-scale renewable energy scheme (SRES), state-specific rebates, net metering rules, and favorable feed-in tariffs have collectively shortened payback periods and enhanced return on investment for households and businesses.
Grid Limitations and Rising Energy Demands: Increasing energy needs in cities and uneven grid reliability in remote communities are driving demand for decentralized energy solutions. Rooftop solar provides an alternative that minimizes transmission losses and alleviates peak load strain.
Falling Technology Costs: The declining cost of solar panels and associated technologies is making rooftop solar increasingly affordable and accessible to a broader range of consumers, driving widespread adoption across residential and commercial segments.
Growing Consumer Demand for Energy Independence: Australian households and businesses are increasingly seeking to reduce their reliance on the grid, lower electricity bills, and gain greater control over their energy consumption, driving demand for rooftop solar systems.
State-Level Renewable Energy Targets: State governments, including Victoria's roadmap to install 7.6 GW of solar by 2035, are setting ambitious renewable energy targets that directly support rooftop solar adoption.
Integration of Advanced Grid Technologies: Utilities are investing in cutting-edge grid technologies, such as LV DERMS, that enable real-time interaction between distributed energy sources and the primary grid, facilitating the integration of rooftop solar.
Australia Rooftop Solar Market Segmentation
IMARC Group provides an analysis of the key trends in each segment of the Australia rooftop solar market, along with forecasts at the country and regional levels for 2026-2034. The report has categorized the market based on grid type, end user, and region.
By Grid Type: On-Grid, Off-Grid
By End User: Residential, Commercial
By Region: Australia Capital Territory & New South Wales, Victoria & Tasmania, Queensland, Northern Territory & Southern Australia, Western Australia
Government Policies and Regulatory Landscape
The Australian government has implemented several forward-thinking policies that are positively shaping the Australia rooftop solar market. The federal government's small-scale renewable energy scheme (SRES) provides financial incentives for households and businesses to install solar panels, making rooftop solar more affordable and accessible. State-specific rebates, net metering rules, and favorable feed-in tariffs further enhance the financial viability of rooftop solar systems.
In 2024, the state of Victoria launched a roadmap aiming to install 7.6 GW of solar by 2035, including 6.3 GW rooftop, 1.2 GW distributed, and 3 GW utility-scale solar, directly aiding the state's wider objective of 95% renewable energy by 2035 and a net-zero aim for 2045. The Australian Capital Territory reported a 62% increase in rooftop solar installations, while Queensland delivered a 36% month-on-month increase.
In November 2025, the Albanese Government announced the Solar Sharer scheme, launching in July 2026 across New South Wales, South-East Queensland, and South Australia. Under the scheme, energy retailers will be required to offer households at least three hours of free electricity in the middle of the day, when rooftop solar generation is at its peak, providing additional savings for households and encouraging further solar adoption. The scheme is expected to be rolled out to other jurisdictions by 2027.
Competitive Landscape
The Australia rooftop solar market features a dynamic and competitive landscape, characterized by a mix of established solar manufacturers, retailers, and installers. The market research report has provided a comprehensive analysis of the competitive landscape, including market structure, key player positioning, top winning strategies, competitive dashboard, and company evaluation quadrant. Detailed profiles of all major companies have also been provided.
Key players in the market are continuously innovating to develop more efficient and affordable solar panels, expanding their distribution networks, and forming strategic partnerships to enhance their market presence. The industry is witnessing increased competition as new entrants and established players vie for market share in Australia's rapidly growing rooftop solar market.
Porter's Five Forces Analysis – Australia Rooftop Solar Market
Porter's five forces analysis assist stakeholders in assessing the impact of new entrants, competitive rivalry, supplier power, buyer power, and the threat of substitution within the Australia rooftop solar market. It helps stakeholders analyze the level of competition within the industry and its attractiveness.
Bargaining Power of Suppliers – Moderate: The market relies on diverse suppliers including solar panel manufacturers, inverter producers, and installation service providers. The presence of multiple global and local suppliers balances power, while the increasing focus on efficiency and innovation creates new supplier relationships.
Bargaining Power of Buyers – Moderate to High: Residential and commercial buyers have extensive choice among multiple solar retailers, installers, and panel brands. The availability of online comparison tools and competitive installer bidding gives buyers significant leverage, though product quality and installer accreditation remain important factors.
Threat of New Entrants – Moderate: Barriers for new installation and retail businesses are relatively low, contributing to a fragmented market. However, achieving scale, securing Clean Energy Council accreditation, and building brand recognition requires investment.
Threat of Substitutes – Low: While other renewable energy sources and grid electricity remain alternatives, the unique benefits of rooftop solar—including energy independence, cost savings, and environmental benefits—create strong differentiation. The declining cost of solar and battery storage further reduces substitution threats.
Competitive Rivalry – High (Healthy): The market is characterized by healthy competition among manufacturers, retailers, and installers, driving continuous innovation in panel efficiency, system design, and customer experience.
Regional Analysis
The Australia rooftop solar market exhibits distinct regional dynamics across the country's major states and territories:
Australia Capital Territory (ACT) and New South Wales (NSW): A leading market, anchored by Sydney and Canberra's high population density, strong policy support, and high solar penetration rates. The ACT reported a 62% increase in rooftop solar installations. The region benefits from well-developed installation networks and strong consumer awareness.
Victoria and Tasmania: A significant market driven by Melbourne's progressive renewable energy policies. Victoria launched a roadmap aiming to install 7.6 GW of solar by 2035, including 6.3 GW rooftop, directly aiding the state's wider objective of 95% renewable energy by 2035.
Queensland: A growing market supported by the state's high solar irradiance and expanding population. Queensland delivered a 36% month-on-month increase in rooftop solar installations. The state benefits from favorable climatic conditions for solar generation.
Northern Territory and Southern Australia: South Australia is a pioneer in rooftop solar adoption, with high penetration rates and strong consumer demand. The Solar Sharer scheme will be rolled out to South Australia from July 2026.
Western Australia: Driven by Perth's robust economy and high solar irradiance, Western Australia has steady demand for rooftop solar systems across both residential and commercial segments.
Key Aspects Required for the Australia Rooftop Solar Market
Demand structure spans multiple segments: The market serves diverse energy needs across on-grid and off-grid systems for residential and commercial end-users nationwide
Strong policy support creates sustained growth momentum: The small-scale renewable energy scheme (SRES), state-specific rebates, net metering rules, and favorable feed-in tariffs have collectively shortened payback periods and enhanced return on investment
Grid integration technologies enabling higher penetration: Utilities are investing in advanced grid technologies, such as LV DERMS, that enable real-time interaction between distributed energy sources and the primary grid
Battery storage integration driving household energy independence: Home battery installations topped 4.3 GWh in 2025, reflecting growing consumer demand for energy storage solutions that complement rooftop solar systems
Solar Sharer scheme expanding consumer benefits: From July 2026, energy retailers will be required to offer households at least three hours of free electricity in the middle of the day, providing additional savings and encouraging further solar adoption
Distribution channels: Include solar retailers, installers, online platforms, and direct manufacturer relationships across all regions
Falling system costs expanding market reach: The declining cost of solar panels and associated technologies is making rooftop solar increasingly affordable and accessible to a broader range of consumers
Recent Industry Developments
The Australia rooftop solar market continues to evolve with positive momentum, reflecting strong policy support, technological innovation, and consumer demand:
April 2026: Australia's rooftop solar market climbed by 31%, with a record 442 MW of small-scale PV capacity installed across the country.
January 2026: Clean Energy Council chief executive Jackie Trad stated that Australia's rooftop solar uptake is "a national triumph," with 28.3 GW of installed capacity eclipsing the country's entire fleet of coal-fired generators.
November 2025: The Albanese Government announced the Solar Sharer scheme, launching in July 2026 across New South Wales, South-East Queensland, and South Australia, requiring energy retailers to offer households at least three hours of free electricity in the middle of the day.
2025: Rooftop solar contributed 14.2% of electricity generated in Australia in the second half of 2025, nearly doubling its achievement since 2020, when it contributed 7.2%.
2025: Australians installed 2.6 GW of new rooftop solar capacity during 2025, with more than 139,080 units installed in the latter half of the year.
2024: Itron and Jemena collaborated to launch a Low Voltage Distributed Energy Resource Management System (LV DERMS) in Australia, offering real-time information and remote-control features to align rooftop solar contributions with grid requirements.
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