U.S. Solar Power Expected to Double in 2010

U.S. Solar Power Expected to Double in 2010

Here at Solar Power International, a conference and trade show that has attracted about 27,000 people to the Los Angeles Convention Center, the exhibit halls and meeting rooms are buzzing.

Big global companies–Sanyo, Sharp, LG, DuPont, 3M and others–are among 1,100 exhibitors clamoring for attention. New products and deals are being announced. Interior Secretary Ken Salazar arrives tomorrow (Oct. 13) to talk about the Obama administration’s efforts to generate large-scale production of renewable energy on public lands.

There’s good reason for all the excitement. The U.S. solar electric industry, including both photovoltaic (PV) and concentrating solar power (CSP) installations, could achieve a milestone by installing a gigawatt of new capacity in 2010. That’s enough to power 200,000 homes, and it’s double the capacity installed in 2009.

Rhone Resch, the president and CEO of the Solar Energy Industries Association (SEIA), which organizes the event with the Solar Electric Power Association (SEPA), told the gathering this morning:

We now live in a world where you can be born in a solar hospital, get educated in a solar school, go to a solar college and while there drink beer brewed at a solar brewery.

 

Get married in a solar church, go to work in a solar office building, watch your favorite baseball team in a solar stadium and live in a country protected by the world’s best armed forces powered by solar. And I’m hopeful that when I get to that magic age, my kids have the opportunity to put me in a solar-powered nursing home.

The breadth and depth of solar in our lives is amazing.

The numbers back up his claim. Solar is the fastest growing form of electric generation in the U.S.,  albeit off a very small base: Less than 1 percent of the electricity in the U.S. is solar powered. But a new report from the SEIA and GTM Research projects that despite the sluggish economy, 944 megawatts of solar electric capacity (composed of 866 MW of PV and 79 MW of CSP) will be installed in the U.S. this year. That’s its baseline scenario. A higher-end forecast puts the number at 1.13 gigawatts.

Either way, that’s an increase of more than 100 percent over the 441 megawatts of solar electric capacity added in 2009. What other business do you know that’s growing by 100 percent this year?

[Disclosure: I’m here at SPI to moderate a CEO panel on the future of the solar business and being paid by the industry to do so.]

Why the growth? Two reasons, fundamentally.

First, the costs of generating electricity from the sun are coming down–whether by using photovoltaic panels, which convert sunlight to electricity, or CSP/solar thermal, which uses heat. Solar is still a more expensive form of electricity generation than wind or natural gas, but the gap is narrowing and some industry advocates say it is about to disappear.

Second, U.S. public policy is solar-friendly and stable. While Congress opted not to enact climate legislation, it has put into place an investment tax credit for renewable energy that will stay in place through 2016. Twenty-eight states have enacted renewable electricity standards.

The SEIA/GTM report says California led states for solar electric capacity installed in the first six months of 2010, followed by New Jersey, Arizona and Florida. (New Jersey’s on that list because of generous state subsidies for solar.) In total, 341 megawatts were installed in the first half of the year. The report projects a stronger second half for 2010 because a 75-megawatt solar thermal plant in Florida is coming online, as are several large PV projects.

The Solar Electric Industries Association has set a goal of installing 10 gigawatts a year.

“That’s enough solar to power 2,000,000 new homes,” Resch said. “Or shut down 10 polluting coal plants each and every year.”

Growing opposition to new coal plants, as it happens, is another driver of the solar business.

So what’s worrying the solar CEOs that I’ve talked to on my first day here? In a word: China.


They told me that China’s undervalued currency and the fact that a government-run bank provides billions of dollars in below-market financing  for big  solar companies–Suntech, Trina Solar, Yingli and and others–makes it hard for U.S., Japanese and European solar firms to compete in the PV business. The subsidies may drive the adoption of clean energy in China, but they are a problem for manufacturers elsewhere.

In the long run, because of the way they distort markets and potentially cut off innovation, they’re probably not good for the environment either. More on that soon–a top exec of Trina Solar is on my panel, and I’ll ask him about the perception that China has an unfair edge in this high-growth business.

GreenBiz.com Senior Writer Marc Gunther is a longtime journalist and speaker whose focus is business and sustainability. Marc maintains a blog at MarcGunther.com. You can follow him on Twitter @marcGunther.