While it’s certainly true that the solar industry is growing at an unprecedented rate, should we go as far as to conclude that solar could become the standard for energy in the U.S. in our lifetime? Some experts think it’s possible, while others remain unconvinced, but the statistics are promising.
According to the Solar Energy Industries Association, “the U.S. installed 7,260 MWdc of solar PV in 2015, the largest annual total ever and 16% above 2014.” In October of 2015, it was predicted that, “More than 1 million American homes should have solar panels by February 2016,” compared with 10 years ago, when the U.S. was at a mere 30,000 PV solar system installations. In early 2016, the U.S. met that prediction, and industry experts anticipate that installations will double in the next couple of years.
Analyzing the Market
Solar energy still only contributes to approximately 1% of energy used to power the country. However, the rate at which its use is increasing is quite impressive. Experts say the decrease in cost to produce and store solar energy, coupled with fewer coal-fueled power facilities has undoubtedly contributed to the industry’s growth.
While experts say the industry will continue to grow through 2016, there is an expected drop for 2017. “As the double-digit gigawatt utility PV pipeline is built out in 2016, utility solar is expected to experience a reset in 2017,” said Cory Honeyman, Senior Analyst at GTM Research. However, “by 2021, GTM Research expects the U.S. solar market to surpass 100 cumulative GW, with an annual install rate of 20 GW or more.”
A variety of factors are involved in the growth of the solar market, and perhaps most significant is the decreasing cost of generating the renewable energy source.
While in the past solar energy was cost-prohibitive for some, its increasing affordability has made solar power a more feasible option for a wider range of individuals. A decade ago, the cost per watt for solar power was at $9.00/watt, vs. 2016, where it’s available for as low as $3.00/watt even before tax incentives are factored in. In addition to the lower cost/watt, there are also a number of zero-money-down financing options now available.
Government support, in the form of incentives, tax credits and other benefits, has also been a major contributor to the growth of solar power. In December of 2015, “Congress extended the Solar Investment Tax Credit,” a tax credit for homeowners and businesses which utilize solar energy. Meanwhile post-tax incentive pricing is now as low as $2.00/watt installed.
Renewable energy sources like wind and solar power were previously thought to be more difficult to integrate into existing power systems than they actually are. Not only is solar energy proving to be easier to implement, but the technology that is being produced to help manage power integration is also making energy use more efficient across the board.
A successful future for solar energy in the U.S. depends upon prices staying competitive, support from government policies, and the continued decline in the use of fossil fuels for energy. If residential solar continues to grow alongside commercial solar, solar has a very good chance of one day becoming the standard for energy in the United States, and perhaps around the world.
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