Photo Credit: graphic by Jacob Rosenburg
It should be a celebratory time for solar in the U.S.
A record-setting third quarter is in the books, with the U.S. installing 449 megawatts of PV, more than the U.S. installed in all of 2009. The total solar installed this year in the U.S. is already over one gigawatt, according to a recent report by SEIA® and GTM Research. The 2010 U.S. total was 887 megawatts.
And installations in the fourth quarter are predicted to be an even larger figure.
The U.S. solar energy industry continues to be one of the fastest-growing sectors of the American economy in 2011. In total, cumulative grid-connected solar electric installations have reached more than 3 gigawatts -- enough to power nearly 600,000 U.S. homes.
The growth in the third quarter of 2011 is due to "utility-scale project completions, a strong residential market, effective policies and the plummeting price of solar panels" according to the report.
So, why the long face?
Well, in addition to the good news from the SEIA and GTM Research, the report cautions that "the U.S. solar market faces substantial market uncertainty with financing and political risks, including the looming expiration of Section 1603 Treasury Program."
The Department of Treasury’s 1603 program, the tax grant program, is due to expire on Dec. 31 unless Congress extends it. In the absence of an extension of the program, the report predicts that "there will be a tax equity bottleneck for projects in 2012, leading to a possible slowdown in installations in late 2012 and into 2013."
According to Rhone Resch, President and CEO of SEIA, “The 1603 program has done more to expand the use of renewable energy than any other policy in U.S. history."
The report finds that "[w]ith the 1603 Treasury Program scheduled to expire at the end of this year, solar project developers will be scrambling to either complete, or safe harbor, projects in the fourth quarter of 2011 in order to qualify for the program’s grant. This will undoubtedly produce robust installation numbers through the end of 2011. However, the uncertainty surrounding the program’s extension threatens the market’s growth in 2012 and beyond."
The other looming threat to the progress of solar installation in the U.S. is the trade petition against Chinese solar imports, which will have an uncertain impact on the market if duties are ultimately levied.