Company: ALCE
Filing Date: 2025-06-06
Form Type: 10-K
Source: 0001213900-25-052242
Chunk: 11

Company: Alternus Clean Energy, Inc.
Filing Date: 2025-06-06
Form: 10-K
Item: Item 1
Chunk 11
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 solar, storage, and microgrids, more financially attractive.

The United States utility-scale solar sector witnessed
record-breaking capacity additions in 2024, demonstrating strong growth in the market for large solar energy projects. Projections from
the US Energy Information Administration (EIA) indicate continued growth in solar capacity through the end of 2025. This sustained expansion
is expected despite potential uncertainties in federal energy policy, as the underlying demand for clean energy continues to rise. However,
a significant challenge that is anticipated to persist in 2025 and beyond is the presence of interconnection bottlenecks and transmission
congestion. These limitations in grid infrastructure pose a barrier to the rapid deployment of utility-scale solar projects, impacting
commissioning schedules and increasing project costs. While the Inflation Reduction Act has provided a substantial boost to the sector
through incentives like the Investment Tax Credit (ITC), the development of adequate grid infrastructure needs to keep pace to support
the continued expansion of utility-scale solar in the United States. It has been this market dynamic that Alternus addressed by expanding
into microgrid solutions that do not have such constraints, are faster to revenues and have lower capex requirements.

8

The US microgrid market is anticipated to experience
substantial expansion, with projections indicating a reach of USD 58 billion by 2030. This growth is expected to occur at a CAGR of 15.6%
from 2024 to 2030.10 This significant market growth is driven by an increasing demand for reliable power, especially in the
face of extreme weather events, and the growing integration of renewable energy sources into the power grid. Another analysis presents
a more conservative estimate, valuing the US microgrid market at USD 7.9 billion in 2024 and forecasting it to reach USD 24.4 billion
by 2033, with a CAGR of 13.3% from 2025-2033.11 A third source estimates the US microgrid market at USD 27.4 billion in 2023,
projecting a reach of USD 49.2 billion by 2030 with a CAGR of 8.7%.12 This represents the most conservative growth estimate
among the reports. However, despite these differences, all reports concur that the US microgrid market is poised for significant growth
over the next five years, with CAGRs ranging from 8.7% to 15.6% and the projected market size in 2030 expected