Guestpost by Jill Clayton, Solarcontact, about photovoltaics in the U.S.
As PV module prices fall, stimulus funding increases, and new regulatory incentives come to be, the demand for PV projects in the U.S. expands. Last year alone, the U.S. solar industry installed more solar power capacity than ever before, totaling an estimated 3.2 GW of capacity. Projections show that 2013 will be another record-breaking year.
Markets slow-down and speed up
While the solar industry is moving forward, it is important to note that the market is not necessarily marching along a steady or consistent path. Rather, markets slow down and speed up on a state-by-state basis, with some states picking up the slack for other states as their market starts to falter. For example, the industry in California, unofficially recognized as the “greenest state”, has slowed a bit, but East Coast states such as New Jersey, Pennsylvania, and Massachusetts have picked up the pace investing in green energy.
Overall, it appears the U.S. is making an effort to switch to renewables and is doing so at both the national and state levels. First, the adoption of utility-scale PV and concentrating solar power (“CSP”) plants is on the rise and forecasted to continue its growth throughout the next decade. Federal incentives, such as investment tax credits and loan programs, help encourage large-scale commercialization of solar energy and promote the establishment of solar plants.
Also, with pressure from the government to forego conventional forms of electricity for renewable energy technologies instead, the demand for solar projects is expected to increase. Now is the perfect time for CSP, in particular, as technological breakthroughs in thermal storage, heat transfer, and collection, as well as the current U.S. political and solar market, provides affordable and commercially viable solar thermal power.
Also contributing to the acceleration in the solar market are renewable portfolio standards (“RPS”). RPS require electricity supply companies to produce a certain portion of their electricity from renewable energy sources. Some states explicitly mandate that a specified fraction of the RPS come from solar resources. In addition, many utilities and state regulatory commissions are realizing that the value in solar outweighs the perceived barriers, which are not as large as they once feared. Thus, some states have increased the amount of solar allowed to use net metering to offset on-site electricity use, while others have acted to cap costs and streamline solar permitting.
Some states are going ahead
State-specific initiatives are also being implemented in an effort to demonstrate their focus on energy efficiency and desire to switch to renewable energies. California, for one, recently achieved a major milestone in installing over 1 GW of solar power capacity through the California Solar Initiative. The Initiative offers financial incentives, such as rebates for an amount per watt from their solar power systems, which are designed to decrease over time as the adoption of solar in the region becomes more widespread. In addition, customers are provided with net metering, allowing them to offset the cost of their electricity use with the energy they generate from their solar panels, for example, and send back to the grid.
New York is another state following suit as Governor Andrew Cuomo has made several significant solar proposals in the expansion of his NY-Sun Initiative. The 10 year, $150 million per year initiative proffers to fundamentally transform New York’s solar market while increasing access to solar, enabling the industry to scale, and reducing the cost of solar. Like California’s Initiative, the NY-Sun Initiative hopes to build a strong and sustainable solar energy industry through various incentives that phase-out over time and supportive regulations that remove restrictive barriers and increase access to solar power.
Overall, the U.S. is making use of both state and federal programs to promote a countrywide switch to renewable energies. While solar power capacity, in particular, is at an all-time high in the U.S., it remains to be seen which programs and initiatives will be the most successful in increasing the amount of solar power capacity installed and creating awareness about the importance of energy efficiency.