Washington-based Solar Electric Power Association (SEPA) has released a report on the US solar power industry and utility rankings for 2014.
According to the report, the US added 5.3 gigawatts (182,000 new systems) of photovoltaic capacity last year, taking the total installed solar capacity nationwide to 16.3 gigawatts (675,500 locations).
Over the past four years, solar capacity in that country has expanded at the average annual growth rate of 35 percent.
The report shows that a greater part of the growth in solar installations during 2014 came from residential solar systems (36 percent).
This was followed by utility scale projects (26 percent), and non-residential projects (12 percent).
“Declining technology costs combined with federal and state incentives have made residential solar installations an attractive investment for homeowners and continue to spur sector growth,” according to the report.
It adds that the cost of solar installations is decreasing as the industry is also working toward lowering “non-hardware soft costs in areas such as financing and customer acquisition”.
However, the solar market in the US continues to remain concentrated with particular utilities and in specific states. California, Hawaii, Arizona, New Jersey, and North Carolina are among the most solar-dense states.
California and Arizona have significantly higher solar production compared with the rest of the US. These states are able to produce solar power at costs close to that of natural gas owing to better insolation.
The report also predicts that there would be a sharp drop in solar build-out after federal tax incentives are dropped in 2017.
With the growth in residential solar power systems, one segment of the industry that calls for greater technological inputs is grid integration of distributed energy resources.
Despite developments on various fronts in the solar industry, though, policy support will remain a key factor that supports the momentum required for future growth in the industry.
California, for instance, has an aggressive renewable portfolio standard (RPS) and other complementary state policies supporting solar development.
But when US Code 25D for individuals and US Code 48 for corporations undergo changes in 2017, corporate ITC will be reduced from its current 30 percent rate to 10 percent and credit for individuals expires entirely. That could affect expansion of the sector.
Another area that will receive greater focus is energy storage technologies.
These can store energy from renewable sources for use during peak load demand or to provide ancillary services to the grid, including ramp rate control, resource firming and dispatchability.
The report says 13 percent (16) of respondents had implemented energy storage solutions and 42 percent (51) were either researching or considering it.
Ajith Kumar S