U.S. Crushes Solar Installation Record In ‘Monumental’ 2015
U.S. solar installations boomed in 2015 to a record-stomping 7.3 gigawatts as legislators bandied about the fate of the Investment Tax Credit on solar, the Solar Energy Industries Association said Monday. For the first time ever, solar energy beat out natural gas capacity additions. Solar energy generated 29.5% of all new electric-generating capacity in the U.S. California, North Carolina and Nevada led the charge, and the three states now top 25 GW in cumulative installations. There’s still plenty of headroom for growth, said Shayle Kann, Greentech Media Research senior vice president. The top 10 states account for 87% of installed capacity, but 24 of 35 states Greentech tracks saw market growth in 2015, he said in a statement. SEIA CEO Rhone Resch, in the association’s press release, called 2015 “a monumental year for the U.S. solar industry.” The year was also marked by Obama’s Clean Power Plan, a pledge to cut carbon emissions by power plants, and a 196-country agreement to cut carbon emissions during the COP21 (Conference of Parties) climate change summit in Paris. “Over the next few years, we’re going to see solar continue to reach unprecedented heights as our nation makes a shift toward a carbon-free source of energy that also serves as an economic and job-creating engine,” Resch said in the release. In 2015, residential installations jumped 66%, outgrowing the commercial and utility markets, which were flat and up 6%, respectively. Still, utility installations — First Solar ( FSLR ) and SunPower ‘s ( SPWR ) wheelhouse — continued to account for more than half of all installed capacity. Overall, installed capacity has grown 1,150% since 2010, when U.S. solar capacity touched just 2 GW. Last year, the residential segment alone eclipsed 2 GW in installations — a first. Residential installations now comprise 29% of the entire U.S. solar market, its largest share since 2009, the SEIA said. Commercial installations trailed but managed to break 1 GW for the fourth year running. Solar Stocks Got Late-2015 Boost From Congress The results shine light on the recently shadowed industry. IBD’s 23-company Energy-Solar industry group is down 31% for the year after sharply rising at the end of 2015 on Congress’ decision to extend the Investment Tax Credit (ITC) on solar for five years. The ITC has been slated to expire Dec. 31, 2016, and Wall Street expected solar demand to hit a floor in 2017. Shares of installers First Solar, SunPower, SolarCity ( SCTY ) and Sunrun ( RUN ) lit up on the extension. Tesla ( TSLA ) CEO Elon Musk chairs SolarCity. But the rally was short-lived. Less than two weeks later, stocks plunged after Nevada regulators opted to cut net-metering payments to solar customers, or what utilities pay solar customers for excess energy fed back into the grid. Warren Buffett’s Berkshire Hathaway ( BRKA )-owned utility NV Energy pushed for the cut, which will take place in five steps over 12 years. Utilities dislike net-metering mandates, which forces them to buy energy at a high cost. This month, Nevada regulators voted against grandfathering in existing solar customers under the old rate scheme. Sunrun executives have said they will sue. In 2015, California regulators went in the opposite direction. The California Public Utilities Commission voted to retain net metering but add interconnection costs, new minimum bill requirements and time-of-use rates, according to Greentech. Other states are likely to take up the issue. Net metering is mandated in 44 states. Last year, 13 states each added at least 100 megawatts in installations, helping lead to 17% growth in the U.S. solar market. Utah jumped from No. 23 state in solar to No. 7, and Georgia moved from 16th to eighth place. Nevada was No. 3 on the installer list for the second year running. In 2013, Nevada was No. 12. California and North Carolina have led in recent years. But analysts say Nevada solar demand is likely to hit a floor in 2016 on the new net-metering rate scheme. SolarCity and Sunrun exited their Nevada operations in December because of that then-pending move. Vivint Solar ( VSLR ), soon to be acquired by SunEdison ( SUNE ), made a similar threat at the time.