Solar Market Sets New Record In 1st Quarter In USA

Solar power is going strong again in the USA, and the first quarter set a new record for the amount of solar power that was installed in the first quarter of a year. In total, 6.1 gigawatts (6100 megawatts) of solar power capacity were installed last quarter, according to the latest US Solar Market Insight report.

The report from the Solar Energy Industries Association (SEIA) and Wood Mackenzie indicates that the boost in growth was in large part thanks to supply chain challenges working themselves out more. Going forward, SEIA and Wood Mackenzie expect rapid solar power growth in the coming few years, especially boosted by the Inflation Reduction Act. They expect the US solar market to triple in the next 5 years. That would mean reaching 378 GW of solar by 2028.

“The IRA has also spurred a surge of new manufacturing announcements, with domestic module capacity expected to rise from fewer than 9 GW today to more than 60 GW by 2026. At least 16 GW of module manufacturing facilities are under construction as of the end of Q1 2023.

“This quarter, the Biden administration provided some clarity on how the landmark law’s adder credits will be applied. The law contains new credits that can be used in conjunction with the solar Investment Tax Credit, like the domestic content, energy communities, and low-income adder credits. In particular, the energy communities and low-income adder guidance will help drive solar and storage investment in underserved communities.”

So, here’s another case of the Democrats’ Inflation Reduction Act stimulating strong cleantech growth.

“As the Inflation Reduction Act begins to flex its muscle and drive demand, the US solar and storage industry is eagerly awaiting further guidance on some of the most impactful pieces of the law,” said Abigail Ross Hopper, SEIA president and CEO. “Timely, specific, and workable implementation guidance from the administration will have a major impact on our success in both the near and long-term. This guidance is powerful, and if done correctly, it could unlock new market potential across the country.”

There are still questions and challenges to overcome to fully maximize the benefits of the IRA, but as the industry matures and time moves on, more and more solar power growth will be possible.

But, let’s get back to the first quarter. Solar power accounted for 54% of new US power capacity.

“Despite rising interest rates and economic headwinds causing customer hesitancy, the residential segment installed 1.6 GW of solar capacity in Q1 2023, a 30% increase from Q1 last year. The residential market segment is on track to add 36 GW of solar over the next five years, growing at an average annual rate of 6%.

“The commercial market also had a record first quarter, with 391 MW installed, putting the segment on track for 12% growth in 2023. Meanwhile, the community solar segment installed 212 MW, a 13% decrease from Q1 2022 due in large part to ongoing interconnection challenges.

“By far, Florida was the top solar state in Q1 2023 thanks to 1.46 GW of utility-scale solar installations. Florida installed over 70% more solar capacity in Q1 than the next highest state, California.”

Let’s see what Q2 brings.