Over the past decade, different economic incentives have been created to increase investments in solar photovoltaics (PV). Although research outlines that investors in renewable electricity technologies (RET) are heterogeneous, policies have not taken this into account when designing subsidy programs. This paper aims to analyse the relationship between policy incentives and the willingness to invest in PV systems for different investor groups, including households, companies, associations, and public organizations. Using data from all applications to the capital subsidy program for PV in Sweden between 2009 and 2021, we analyse the impact of the subsidy level on investments over time. Our analysis shows that the subsidy has had a positively significant impact for households and private companies as investor groups. However, we also found that other variables have had a significantly positive or negative effect on the willingness to invest for different investor groups. This stresses the need of going from “one size fits all” policies to policies that better adapted to different investor characteristics. To meet the urgent need to accelerate the diffusion of RETs, our results show the impact of investor heterogeneity on policy responsiveness and provide avenues for the design of targeted policies. © 2024 The Author(s)