The United States has installed 2.7 gigawatts of photovoltaic (PV) solar energy in the first three months of the year, making this technology the most installed in the first quarter of the year. With this strong first quarter, Wood Mackenzie Power & Renewables expects growth of 25% in 2019 compared to 2018, and expects more than 13 GWdc of installations this year.
These data come from Wood Mackenzie’s new US Solar Market Information report and the Solar Energy Industries Association (SEIA), which together announced in May that the US reached the milestone of 2 million solar installations during the first quarter of 2019.
“First quarter data and projections for the rest of the year are promising for the solar industry,” said Abigail Ross Hopper, president and CEO of SEIA. “However, if we’re going to make the kind of progress we need to make the 2020s the ‘Solar Decade,’ we’re going to have to make substantial policy and market advances.
Most of the installations during the record quarter came from the photovoltaic segment of the electricity companies, which connected 1.6 gigawatts to the grid, representing 61% of installed photovoltaic capacity. The report notes that with 4.7 gigawatts of large-scale projects under construction, 2019 is on track to be a solid year for the electricity photovoltaic business, with 46% growth over 2018.
“The acquisition of photovoltaics by electricity companies based on their economic competitiveness continues to be the main driver of projects announced in 2019,” said Colin Smith, Wood Mackenzie’s senior solar energy analyst. “While many states, utilities and cities have announced or proposed 50% or 100% renewable energy or zero-carbon standards, the announcements have not yet led to an increase in RPS-driven acquisitions,” Smith added.
The residential market also experienced annual growth. According to the report, residential solar system installations reached 603 MW in the first quarter, an increase of 6% over the same period last year.
“Despite consistent installations in the first quarter of 2019, the residential market still relies heavily on inherited state markets, such as California and the Northeast, which have experienced moderate or flat growth in recent quarters,” said Wood Mackenzie Solar analyst Austin Perea. “As these large state markets continue to grow, higher acquisition costs for customers will challenge the industry to innovate product offerings and diversify geographically,” Perea continued.
In fact, the report notes that 29% of residential capacity in the first quarter of 2019 came from markets outside the top 10 solar states by capacity, the highest proportion for emerging markets in the industry’s history.
The non-residential segment, which represents the commercial, industrial and distributed public solar sector, registered 438 megawatts of installed photovoltaic energy in the quarter, down from the previous quarter and the same quarter last year. According to the report, this is largely due to state-level policy reforms in historically strong markets for the segment, including California, Massachusetts and Minnesota. The authors note that new community solar mandates in New York, Maryland, Illinois and New Jersey will help revitalize the segment beginning in 2020.
Total installed PV capacity in the U.S. will more than double over the next five years, with annual installations reaching 16.4 GWdc in 2021 before the expiration of the residential Investment Tax Credit (ITC) and a drop in the 10% commercial tax credit for projects that have not yet begun construction.