Solar PV installations break records in 2013
Solar PV installations break records in 2013
A staggering 4,751 megawatts of solar photovoltaic (PV) capacity were installed last year, making 2013 a record-breaking year, according to newly released data.
The market value of all the solar installations in 2013 was $13.7 billion and is proving to be an important source of green jobs, according to "U.S. Solar Market Insight: 2013 Year In Review," from GTM Research and the Solar Energy Industries Association. More solar capacity was installed in the last 18 months than the last three decades combined. Fourth quarter solar installations were particularly strong, increasing 33 percent over the third quarter.
In 2013, solar was the second-largest source of new electricity generation capacity at 29 percent, second to natural gas at 46 percent. Wind energy comprised a mere 9 percent, down from the leading source of new generating capacity in 2012 at 41 percent, in large part due to uncertainty around the wind energy tax credit.
PV growth is predicted to increase in 2014, according to the report, with installations nearing 6 gigawatts (GW) of capacity. This represents a 26 percent growth in installed capacity compared to 2013. The following three sections of the market experienced very different conditions and factors, but all benefited from lower-cost solar panels and system components.
Non-residential solar energy market
This market, comprised of commercial, school, nonprofit and government installations, grew by 4 percent last year to 1,112 megawatts (MW) of new installed capacity. The non-residential solar market was volatile in 2013 for project developers. Performance of the first three quarters was poor, but was followed by impressive fourth quarter growth. This appears to be an indication that 2014 might be a promising year.
The markets in New Jersey, California and Arizona shrank betweeb 2012 to 2013, but Massachusetts saw impressive growth. The clarity around the next phase of the Solar Renewable Energy Credits program helped make the state the third largest non-residential solar market for 2013, and growth is likely to remain strong in 2014.
Solar installations costs varied very widely, and were often higher when the installers were paid a prevailing wage for school and governmental projects in Arizona. Nationally, however, installation costs dropped each quarter by 11 percent, and the average system price fell by 16 percent from 2012 to $3.57 per watt.
Residential solar energy market
This market represented the lowest quantity of installed capacity in 2014 of the three market segments, which include residential, non-residential and utility. But the quantity of residential solar installations has grown steadily each year since 2000, and climbed from 494 MW in 2012 to 792 MW in 2013, representing 60 percent market growth in just one year. The report predicts that the most rapid growth is anticipated in the residential market in 2015. If this is indeed true, that is an enormous jump in one year.
There are a few primary reasons that residential installations have steady gained traction in the market over the last decade. Sales channels have become more diverse, and this is predicted to increase in 2014 with further solar partnerships from banks and retail channels. Financing options available for residential systems have increased with leases, power purchase agreements and loans, removing a barrier to new system owners. The cost of solar systems has also fallen, reaching a new low of $2.59 per watt. Prices fell in most major markets, but vary widely.
California led the way, with 55 percent of residential solar installations in the fourth quarter. The market doesn't show signs of abating in the near future, so the importance of California in the overall solar market will continue to increase over time.
With 2,837 MW of additional capacity and 58 percent growth over 2012, the utility segment of the market experienced strong growth in 2013. A record-shattering 1.4 GW of capacity came online in the just fourth quarter of 2013, bringing the operating U.S. utility capacity up to 5.8 GW. Prices fell to $1.96 per watt, though they vary widely by market and installer.
Renewable portfolio standard-driven demand, however, has started to decline. At the moment, 3.3 GW of new capacity is currently under construction and is expected to come online in the upcoming two to three years. Another 25 GW of capacity has been announced, but is in the pre-contract phase.
Solar cell close-up by robcocquyt via Shutterstock.