US Solar Energy Industry In A Slump? Not So Fast!
Here’s yet more proof that the US solar industry will continue to push out fossil fuels, despite pushback from the usual suspects. A new third-quarter report from the Solar Energy Industries Association totes up a strong year-over-year growth rate of 45% for the quarter. That’s not the most significant thing about it, though. The real action is in some of the 15 states reporting their best quarter ever.
Solar Energy In The US, One House At A Time
To be clear, it’s not all hearts and roses for the US solar industry. The new US Solar Market Insight report, prepared by SEIA with the research firm Wood Mackenzie Power & Renewables, notes that overall growth for 2019 is forecast at 23%, down slightly from an initial forecast of 25% earlier this year.
That’s a lot better than the picture looked just a couple of months ago. In September, the SEIA/Wood Mackenzie second-quarter report described a gloomier outlook of just 17% growth for the US solar energy industry year.
So, what helped the solar industry claw its way back toward 25%? For starters, the Q2 report took into account a shift in plans for several large scale projects. They were due to start in 2019, but were pushed back to next year. That partly accounts for the lowered expectations.
Large scale projects missed the boat, so it was left to small scale installations to come to the rescue. The report attributes the rosier outlook to the “record-setting” pace of small scale residential installations in Q3:
“The increase in residential installations helped the U.S. solar market grow 45% year-over-year and contributed to 15 states having their best quarter ever for residential solar. States with smaller solar markets such as Idaho, Wyoming, New Mexico and Iowa all saw record residential growth due to continued price declines and improvements to the economic competitiveness of solar across the country.”
Residential solar energy installations totaled 700 megawatts in Q3, accounting for a generous share of the overall added capacity of 2,600 megawatts for the quarter.
Not for nothing, but the strong Q3 figure also topped the industry’s previous record of 687 megawatts for residential solar energy, set back in 2016.
Solar Energy Plus Energy Storage: Beat That, You Fossils
Falling costs are of course a major factor behind the rising interest in residential solar energy. The report also teases out two other important and related elements in that area: the falling cost of energy storage, and the growing need for energy storage.
Those two elements are especially evident in California, where both planned and unplanned power outages are motivating the solar-plus-storage trend.
Austin Perea, Wood Mackenzie’s senior solar energy analyst, had plenty to say on that topic.
“While California has always led the country in solar deployment, the drivers behind that growth have shifted,” he explained. “This is primarily due to new-build solar demand and increased consumer interest in solar + storage solutions as a result of public safety power shutoffs that have left hundreds of thousands of utility customers in the dark.”
Red, Blue, Purple: Everyone Hops On The Solar Energy Bandwagon
Perhaps the most significant finding in the new report is that residential solar energy adoption is accelerating in states that were previously reluctant to take the plunge.
The falling cost of solar can take credit for that trend. Consumers and businesses know a deal when they see one, and that puts the heat on state policymakers to undo some of the bottlenecks that were inhibiting solar markets in some states.
The report notes that aside from another record setting quarter for solar-friendly California, 14 additional states also set new records. Some of these have not been particularly welcoming to the solar industry in past years, and they range in size from relatively modest markets like Idaho to heavy hitters like Florida and Texas.
What About Natural Gas?
As for the decarbonized economy of the sparkling green future, take a look at the chart above and you’ll see that new coal capacity is virtually extinguished after 2014.
Meanwhile, natural gas is hanging in there for new capacity. That could change over the next few years as offshore wind farms come online at scale.
The long term outlook for renewables in the US is complicated by federal tax policy, but the advent of residential solar-plus-storage and hybrid wind-solar power plants could throw a new wrinkle of bottom line motivation into the solar energy mix.
In addition, Energy Department is continuing to promote solar energy programs that help cities — which have become powerful drivers of climate action in the US — accelerate local markets for residential solar.
The emerging agrivoltaics field — combining agricultural uses with solar installations — could also provide an unanticipated boost for the market.
CleanTechnica is reaching out to Wood Mackenzie for some additional insights on that score, so stay tuned.
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Image (screenshot): Wood Mackenzie via SEIA.
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