A recent prediction made by a leader in solar industry research shows installed solar capacity in the United States increasing by a factor of 10 over the next 10 years.
Shayle Kann is the VP of research at Greentech Media, a leader in solar industry data. His recent solar prediction helped kick off one of the biggest yearly solar events – the U.S. Solar Market Insight.
Kann points out that it only took the U.S. five years, from 2010 to 2015, to grow its solar capacity by one order of magnitude (ten times) from 2.5 gigawatts to 25 gigawatts. What will it take for us to reach another order of magnitude and get to 250 gigawatts?
Let’s consider Kann’s analysis of coming solar trends that should help us reach 250 gigawatts.
The most significant factor, of course, is cost. It’s predicted that utility scale cost of solar will approach $1.00 per watt by 2020. This should allow considerable growth in solar installations in the coming years at an accelerated pace.
At the same time, the cost of convention electricity is expected to increase as it has done historically. Kann notes that electricity prices have risen faster than the rate of inflation in the past. In fact, the Energy Information Administration expects a 2.6 percent increase in the cost of conventional energy through 2040.
In order for 250 GW by 2025, Kann emphasizes that we’ll need the rest of the country to take on solar in earnest. As it currently stands here in 2015, only 10 states make up the 90 percent of all installed solar capacity.
The fact that the 30 percent federal tax credit is set to expire at the end of next year was also accounted for in his analysis. He mentioned that no one knows the exact affect this will have on the solar market. It may be initially detrimental, but as prices fall a bit more and the word spreads about how affordable solar is even without subsidies, solar growth can still be expected. The ending of the tax credit is just one of many reasons to buy solar panels sooner than later.
As for the residential segment, Kann touched on an idea thoroughly discussed here at Solar Power Now – how the larger solar installers are still charging too much based on their costs structures. Namely “customer-acquisition” costs are adding quite substantially to the price of going solar with the typical big name installer.
He also stressed the emerging importance of energy storage. It’s quite apparent that if we are truly to rely on solar power, we’ll need to access it after sun down. As costs for energy storage systems decrease, we’ll see an increasing number of utilities, businesses, and homeowners acquire them.
250 gigawatts is a considerable amount of energy. In fact, it is about 10 percent of the nation’s yearly usage. It’s amazing to think that in just a few short years, solar power can reasonably supply that much energy.
There’s much optimism surrounding these solar power goals. In addition to the economics becoming much more sound, the fact is that many are simply not aware of how affordable solar power now is. As more business leaders and homeowners discover what a great deal solar is, the expansion of solar will happen that much quicker.