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US market solar forecast – Can the US hit the 2 GW installed capacity in 2011? US market solar forecast – Can the US hit the 2 GW installed capacity in 2011?

Spring in the US and the solar market is buzzing…but is it on track and what can we do to get the US solar market to jump in for the predicted decline in the European markets? It has been widely announced that Germany has been cutting its incentives on the Feed-In-Tariff (FIT) and many research firms and analysts, EUPD-Research among them, predict the German market to slow down in 2012 to around 2.5GW installed capacity. This would be a drop to the current installed yearly capacity of over 60%.

We still have to see what effects the disaster in Japan has on the renewable energy industry, as the public and some governments are pushing for an exit from nuclear power.  Italy has been going strong and the delay of the FIT cap has helped, but the market expects for a cap to arrive sooner than later. France has a strong program, however there are signs on the horizon that changes to the incentive program are around the corner as well. As the China Daily reported last week, may double their solar power capacity goal from 5GW to 10GW by 2015, currently having 1GW installed, but the question is how much opportunity is in the market for non-Chinese manufacturers.

No wonder the solar industry is looking for new markets to develop and hopefully jump in to take on some of the production capacity that the industry turns out day by day. South American markets are slowly developing and some African markets and the Australian market are also showing growth signs, however most of these markets are still insignificant in scale. Therefore, many eyes are looking upon the US market to finally come online and really take on the growth that everybody is hoping for.

Solarbuzz (www.solarbuzz.com) has just announced that according to their new United States Deal Tracker report, the solar PV project order backlog for the U.S. has exceeded 12GW. With these figures in mind the market is now speculating that the US will again be able to double its install capacity in 2011. This would mean that the US market would reach roughly 2GW in scale this year and as PV Tech (www.pv-tech.org) states, it would make it “the highest growth market in the next two years”.

The new addition of the deal tracker logs, according to Solarbuzz,  over 375 non-residential projects in the US project pipeline being planned or going through a Request for Proposal process. It also includes an additional 775 projects that total 0.7 GW of PV systems either installed or being installed since January 1, 2010. The main focus of these projects are non-residential PV systems, ranging from 50 kw, which I assume are mostly commercial rooftops up to a system size of 1GW, up to large utility scale projects of several hundreds of MW, which have been widely publicized as well. According to Solarbuzz and also what I have noticed following press announcements the US solar market in its scale is largely dominated by large scale ground-mount projects mostly driven by utilities and established solar module manufacturers.

Solarbuzz – Non-Residential Projects by System Size

Solarbuzz also states that utility-scale projects being developed are in 29 of 50 states, which is promising that a number of states in the US are now are supporting PV developments, with the largest being California, New Jersey, Massachusetts, Pennsylvania, Arizona, Texas, Colorado, North Carolina, Nevada and Florida. However four states dominate this project pipeline providing 80% of the total measured megawatts.

Uplifting is that the price development in the United States per watt installed PV is coming down and Solarbuzz states that the biggest U.S. projects are being installed at a range between US$3-4 per watt DC.

More information about the Solarbuzz market study can be found here – http://www.solarbuzz.com/our-research/recent-findings/united-states-solar-photovoltaic-project-order-backlog-surpasses-12-gw

I do believe that it is important for the US market to develop a healthy residential market in photovoltaics as such a market negates some of the issues larger utility scale developments face, mainly a lack in infrastructure, transporting the energy where it is needed most. Important is also that states, counties and cities develop an easier permitting process thereby further decreasing of the installation costs of PV. Hopefully a unified incentive program will be put in place in the near future or at least attractive financing for homeowners, making solar deployments on a residential scale more of a standard than the exception.

I think it is exciting to see how quickly the market will develop…

Have a sunny Day

Boris

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