Year-to-date total solar surpasses 2011 annual at 2 GW; California and Arizona lead state rankings
WASHINGTON D.C. -- GTM Research and the Solar Energy Industries Association® (SEIA®) today released the U.S. Solar Market Insight: Third Quarter 2012. The report finds that the U.S. solar photovoltaics (PV) market installed 684 megawatts (MW) in the third quarter (Q3) of 2012, representing 44 percent growth over the same period last year. This quarter marked the third largest on record for the U.S. PV industry and raised the total installed capacity through the first three quarters of the year to 1,992 MW — already surpassing 2011's annual total of 1,885 MW.
Cumulatively, there are now 5.9 gigawatts (GW) of PV, which converts sunlight directly to electricity, operating in the U.S. from more than 271,000 installations. Combined with concentrating solar power facilities (CSP), which convert the sun's heat to electricity, there are more than 6.4 GW of solar electric capacity installed in the U.S., enough to power more than one million average American households.
The third quarter featured strong growth in distributed generation (DG) markets; the residential PV sector installed more than 118 MW, an all-time high for a quarter, while the commercial market (including governmental and institutional facilities) hit 257 MW, rising 24 percent above last quarter.
In addition to solid growth nationally, Colorado, Florida, Maryland, Massachusetts, and Pennsylvania saw growth of 5 MW or greater compared to the previous quarter. Behind Maryland, Massachusetts saw the greatest quarter-over-quarter increase, up from 25 MW in Q2 2012 to 40 MW this quarter. All Massachusetts installations in Q3 2012 came from the commercial and residential sectors, boosted by the expansion of net metering allowances and an influx of national retailers that offer leasing and other innovative "third-party" ownership models. For the quarter, the top ranked states were California, Arizona, New Jersey, Massachusetts and Nevada. As of Sept. 30, top states for total cumulative installed solar electric capacity were: California, New Jersey, Arizona, Nevada and Colorado. (See complete state rankings charts here.)
The GTM and SEIA research teams expect third-party leased PV systems to remain a hot option in the market for homeowners into 2013 and beyond. During this quarter, residential PV markets in Arizona, Colorado, California, and Massachusetts saw third-party systems range from 57 to 91 percent of total residential system installations.
"While Q3 2012 was remarkable for the U.S. PV market, it is just the opening act for what we expect to see in Q4," said Shayle Kann, vice president of research at GTM. "We forecast more than 1.2 GW of PV to be installed next quarter on the back of developers who are pushing to meet year-end deadlines in both the utility and commercial segments. We also expect to see the residential PV market post another record number in Q4, as third-party residential installers gain more traction in mature, cost-effective markets."
Historically, Q4 has been the strongest for PV installations in the U.S. In 2010 and 2011, Q4 represented 41 percent and 42 percent of annual installations, respectively. U.S. Solar Market Insight® forecasts a similar Q4 bump in 2012 with approximately 1,200 MW to be installed. That would not only account for 38 percent of this year's forecasted total, but would be the largest single quarter on record for the U.S. PV market by far. SEIA and GTM Research expect 2012 growth to top 70 percent with a record 3.2 GW of solar installed – enough to power more than half a million average U.S. homes.
"This quarter's record residential growth shows the power of innovation in the U.S. solar industry," said Rhone Resch, president and CEO of SEIA. "With costs continuing to come down and new financing options, solar energy is affordable today for more families, businesses, utilities, and the military. Thanks to smart long-term policy, the solar industry is growing to meet the challenge of putting Americans back to work and helping to grow both our nation's economy and our clean energy portfolio."
System prices for PV projects in the U.S. continued their downward trajectory in third quarter 2012. Average residential system prices dropped quarter-over-quarter from $5.45 per watt to $5.21 per watt nationally while average non-residential prices declined 15 cents per watt, falling to $4.18. Average utility system prices, which are currently at $2.40 per watt, continue to see the greatest reduction in prices of the three market segments covered, falling by 30 percent since third quarter last year.
Commercial installations grew 24 percent in third quarter over second quarter in 2012, led by notable growth in California and Massachusetts; a strong fourth quarter is also expected for this market.
"The data coming out of the U.S. Solar Market Insight reports mirrors what we are seeing as an owner of commercial rooftop solar projects in the U.S.," said Mike Ward, U.S. president, IKEA. "We completed 23 solar installations in 2012 and next year, we plan to deploy at least 7.5 megawatts of solar PV at five more IKEA locations across the U.S. Having strategic data and understanding trends in each state market is crucial for us to achieve our goal of having 90 percent of our facilities powered by solar and reaching a total generating capacity of 38 megawatts."
Today, the U.S. solar energy industry employs 119,000 Americans at 5,600 companies, mostly small businesses, across all 50 states.
Key Report Findings
PV installations totaled 684 megawatts in Q3 2012, up 44 percent over Q3 2012, enough to power 113,000 average U.S. households; third largest quarter following Q4 2011 and Q2 2012.
Residential installations grew 12 percent over Q2 2012 and had its largest quarter in history; residential continues to be the most stable growth segment in solar.
The commercial market grew 24 percent over Q2 2012, led primarily by growth in California and Massachusetts.
Concentrating Solar Power (CSP and CPV)
The BrightSource Energy Ivanpah project in California is progressing on schedule, with the project (392 MW) coming online in stages during 2013.
Abengoa's Solana 280 MW Generating Station in Arizona is over 75 percent complete and expected to be online in summer 2013.
SolarReserve continues power purchase agreement (PPA) discussions with Tri-State and Xcel for its 200 MW Saguache project in Colorado.
The California Public Utilities Commission (CPUC) unanimously approved an amended PPA for BrightSource's 200 MW Sonoran West Project.
Note: Solar heating and cooling (SHC) industry data is not available quarterly. Click here for most current SHC figures.
About U.S. Solar Market Insight:
The U.S. Solar Market Insight: Third Quarter 2012 report is the most detailed and timely research available on the continuing growth and opportunity in the U.S. The report includes deep analysis of photovoltaic (PV) and concentrating solar power (CSP) technology markets in the U.S., identifying the key metrics that will help solar decision-makers navigate the market's current and forecasted trajectory.
About GTM Research:
GTM Research, a division of Greentech Media, provides critical and timely market analysis in the form of research reports, data services, advisory services and strategic consulting. GTM Research's analysis also underpins Greentech Media's webinars and live events. Our coverage spans the green energy industry including solar power, smart grid, energy storage, energy efficiency and wind power sectors.
About SEIA®: Established in 1974, the Solar Energy Industries Association® is the national trade association of the U.S. solar energy industry. Through advocacy and education, SEIA and its 1,000 member companies are building a strong solar industry to power America. As the voice of the industry, SEIA works to make solar a mainstream and significant energy source by expanding markets, removing market barriers, strengthening the industry and educating the public on the benefits of solar energy. www.seia.org