Last year was a record-breaking year for U.S. solar energy, as the PV industry grew by 76% in 2012 compared to 2011.
The U.S. Solar Market Insight Report: Year In Review, co-authored by GTM Research and the Solar Energy Industries Association, said that 2012 PV solar installations were 3.31 GW, more than 40% all previous U.S. solar online capacity.
Last year’s strong installation numbers provided a value of $11.5 billion in solar PV, $2.9 billion more than in 2011 ($8.6 billion), and almost double new installations’ value in 2010 ($5.6 billion).
Much of the firmness in the U.S. solar market is attributed to continuing falling costs. For example, the blended average price in the fourth quarter of 2012 for PV modules was $0.68/watt, a sharp decline of 41% compared to the fourth quarter of 2011 when it was $1.15/watt.
Factor retail electricity prices skyrocketing by 35% since the start of 2000, and the average price of solar systems dropping by 70% in the same period, and it’s quite obvious why solar is growing so rapidly in the 21st century.
While last year was very strong, the fourth quarter blew out all the others, with 1.3 GW of new solar PV systems coming online that quarter, far surpassing the 684 MW in the third quarter.
All of these factors help to boost the U.S. solar market, which is producing 11% of all solar installations globally.
Besides strong growth being a key highlight of the solar energy industry in 2012, other market events shaping the industry included: consolidation of manufacturers, trade dispute resolutions, third-party solar leasing becoming a popular choice, and large-scale solar projects starting to take shape.
At the domestic level, California again led all states in PV installations, followed by Arizona, New Jersey, Nevada, and North Carolina (see graphic below).
Looking forward, GTM and SEIA predict 30% market growth in 2013, with 4.3 GW of new capacity installed, and modest growth from 2014 through 2016. Meanwhile, a dramatic increase of 9 GW of new capacity is forecast in 2016, the last year of the solar investment tax credit, which provides a 30% credit for new installations.
Where Does the U.S. Solar Market Go from Here?
With China now a dominant player in the solar market, and global PV solar installations set to reach 31 GW this year, everyone will watch to see if the U.S. can go tit for tat with the other heavy hitters. Reports like this one today, along with 89% of Americans wanting solar energy as part of the energy mix, imply that the U.S. will remain a premier leader in solar energy in the coming years.