Company: ALCE
Filing Date: 2025-06-06
Form Type: 10-K
Source: 0001213900-25-052242
Chunk: 12

Company: Alternus Clean Energy, Inc.
Filing Date: 2025-06-06
Form: 10-K
Item: Item 1
Chunk 12
---
 to be considerably larger
than current valuations.

Europe

In Europe, the market has been further catalyzed
by recent geopolitical instability, which has shifted the energy narrative from climate action alone to one centered on energy independence.
European Commission President Ursula von der Leyen summarized this shift by stating “Energy security is one of the most pressing
topics for Europe. The EU will diversify away from Russian fossil fuels and will invest heavily in clean renewable energy.”

With ambitious renewable energy targets, forecasted
to more than quadruple generation capacity by 2030, the EU has introduced robust regulatory and financial support to accelerate the energy
transition.13

The utility scale solar market in the European
Union reached a new peak in capacity additions in 2024, although the rate of annual growth has decelerated compared to previous years.
While the market continues to expand, this slowdown could be attributed to various factors such as grid infrastructure limitations and
evolving incentive schemes for solar installations. Notably, utility-scale solar emerged as the largest market segment in the EU in 2024,
surpassing residential rooftop solar installations in terms of market share. This shift indicates a growing focus on larger solar projects
that can contribute significantly to achieving national and EU-wide renewable energy targets. Looking ahead, the European solar market
is expected to experience more moderate annual growth rates, projected to be in the low single digits (3-7%) between 2025 and 2028. This
stabilization in growth reflects the emergence of structural challenges, including grid bottlenecks and the increasing need for grid flexibility
to accommodate the growing share of variable renewable energy. While rooftop solar has played a vital role in the past, utility-scale
projects are now taking the lead in the European market, highlighting their importance in the region’s energy transition. Addressing
grid infrastructure and implementing policies that promote grid flexibility will be crucial for sustaining the growth of utility-scale
solar in Europe in the coming years.

The European microgrid market held a valuation
of USD 2.9 billion in 2023, according to UnivDatos, and is projected to experience substantial growth, reaching USD 11.7 billion by 2032.
This represents a strong CAGR of approximately 17.3% during the forecast period of 2024-2032. This growth is propelled by the increasing
necessity to upgrade aging electricity infrastructure across the region and the implementation of off-grid electricity solutions, particularly
in rural areas. Furthermore, the rapid transition