Solar future looks bright for society

Solar energy accounted for nearly 40% of all new electricity generation added in the U.S. in 2019, the largest annual share in the industry's history.

According to the most recent quarterly report, the U.S. Solar Market Insight, presented by Wood McKenzie and the Solar Energies Industries Association (SIEA). The growth of solar photovoltaic (PV) shows signs of outstripping other energy competitors.

According to the report, PV accounted for 39.8% of new electricity generating capacity additions in the U.S., surpassing those of natural gas and wind.

This number can be attributed to the growth of residential use solar PV, setting a record breaking high for residential use solar.

Due to the 2019 wildfires in California, the demand for residential solar energy grew with the crucial driver for this growth being the public-safety power shutoff (PSPS) events, which cut residents off grid power.

These power shutoffs prompted homeowners to purchase solar, increasingly paired with battery storage.

This resulted in record-breaking installations during the fourth quarter of 2019, making California the first U.S. state to install more than 300 megawatts (MW) of residential solar in a single quarter and ending the year with more than 1 gigawatt (GW), or 1,000 MW, of residential PV installations for the third time in history.

Outside the residential market, utilities maintained the largest share of installed PV capacity in the U.S. during 2019, representing 63% of all installed solar capacity for the year.

The high demand for utility solar is sustained by several factors. With power-purchase agreement prices ranging from $16 to $35 per megawatt-hour (MWh), the economic competitiveness of solar with other energy generation sources is driving new purchase in established markets.

The U.S. utility PV market is poised to see more than double what was installed over the last five years, in the coming five, from 2020 to 2025.

Although the Trump administration's tariffs on solar modules and other component parts have imposed additional costs, utility PV has continued to be cost-competitive with other energy generating sources in the U.S.

Additionally, the number of states and utilities pledging renewable-energy or carbon-reduction targets continues to rise.

Twenty-eight states have established clean-energy or carbon-reduction targets, with 23 states having signed the U.S. Climate Alliance pledge to reduce economywide emissions by 28% by 2025.

Furthermore, eight governors have issued executive orders mandating increases in renewable or clean energy targets in their states. While some of these state pledges are not legally binding, they have created demand and pressure for additional renewables in more state markets.

In its report, Wood Mackenzie projected a 47% annual increase in solar installation this year. With the full impacts of the COVID-19 outbreak not fully known at publication, the global research firm has not revised this projection.

"Wood Mackenzie's solar team is tracking industry changes closely as they relate to solar equipment supply chains, component pricing and project development timelines, taking these impacts into consideration for future publications," the research wrote.