Despite a small dip in projects in the most recent quarter, U.S. solar investors have reason for optimism.
To be sure, installations of solar photovoltaic capacity dipped 7% in the second quarter compared to the same quarter a year ago. But the current 69.1 gigawatts of total installed capacity represented a new high, representing the ability to light 13.1 million American homes, according to the report.
“It’s no surprise that the U.S. solar pipeline is surging as costs continue to fall and solar becomes the lowest-cost option for utilities, corporations and families,” Abigail Ross Hopper, president and CEO of SEIA, said in a statement. Ross urged lawmakers to extend the solar Investment Tax Credit so that the U.S. could generate 20% of its power from solar by 2030.
Wood Mackenzie is forecasting a 17% year-over-year growth in installations in 2019 as more companies look to increase their use of renewable power. Corporate solar procurement accounts for 17% of the new utility-scale solar capacity announced this year. Starbucks, Microsoft and Anheuser-Busch are among the companies that have announced solar projects.
- Utility-scale solar prices are tumbling, with recently signed power purchase agreements signed in the $18-$35 per megawatt-hour bracket, according to Wood Mackenzie.
- Residential solar continues to rebound, growing 3% quarter-over-quarter and 8% year-over-year. The second quarter was the fourth consecutive with more than 600 megawatts of installed residential capacity.
- Over the next five years, U.S. photovoltaic capacity will more than double. Annual installations will reach 17.6 GWdc in 2021 before the federal Investment Tax Credit for residential solar and a drop in the commercial tax credit expire.
- According to a separate report from Fitch Solutions, U.S. solar capacity will grow an average 7.9% between 2022 and 2028. The forecast is likely to revise upward as more firms commit to renewable electricity targets and installation is simplified.
Karma Takeaway: Solar prices are dropping while demand grows, which are positive developments for consumers, investors and entrepreneurs in the space.