Fueled by Growth in Residential Solar, US Installs 1.3GW of PV in Q1 2015

Record-breaking snow couldn't slow residential solar's continued growth.

Shattering previous records, the United States residential solar market grew 76 percent over the first quarter of 2014, installing 437 megawatts of photovoltaics (PV) in the first three months of 2015. According to GTM Research and the Solar Energy Industries Association's (SEIA) Q1 U.S. Solar Market Insight report, released today, the U.S. installed 1.3 gigawatts of solar PV across all market segments.


FIGURE: U.S. PV Installations, Q1 2010-Q1 2015
(http://goo.gl/bY5Y0B)
Source: GTM Research / SEIA U.S. Solar Market Insight report

The Northeastern U.S. experienced one of its worst winters ever recorded, but that didn't prevent the residential solar market segment from having its best quarter of all time. The first quarter tends to be the slowest time of the year for the solar market due to weather, accounting and tax considerations. Despite these headwinds, the residential market still grew 11 percent over last quarter, its previous high-water mark.

"Q1 2015 provided a clear glimpse into the role that residential sector will play as a primary driver of not only solar market growth, but the overall electricity generation mix," said Shayle Kann, senior vice president at GTM Research. "In the first quarter of this year, the U.S. installed more residential solar than natural gas, and solar on the whole accounted for 51 percent of all new electric generating brought on-line. We expect more than 3 million residential solar installations over the next five years, marked by a broader trend toward customer engagement in energy usage, generation and management."

The non-residential and utility segments were more impacted by some of the market's usual seasonality.

The non-residential market installed 225 megawatts in the first quarter of the year. The report notes that customer origination, project finance and state incentive reductions continue to challenge the segment. But despite these challenges, five of the six largest non-residential state markets did grow over Q1 2014.

Continuing to carry the largest share of the market, the utility segment installed 644 megawatts, which represents 49 percent of new PV capacity brought on-line in Q1 2015. Utility PV installations have now surpassed 500 megawatts for eight consecutive quarters. Yet the highlight of this quarter for the segment was not what came on-line, but instead what was procured and added to the pipeline.

The report notes that there are now 25 project developers with pipelines in development of 100 megawatts or more. GTM Research expects a flurry of activity in the utility segment over the next 18 months ahead of the scheduled decline of the federal Investment Tax Credit.

FIGURE: Utility PV Pipeline
(http://goo.gl/gN9EAW)
Source: GTM Research / SEIA U.S. Solar Market Insight report

"Today's report reveals just how important establishing and maintaining effective, forward-looking public policies, like the solar Investment Tax Credit, are to America," said Rhone Resch, SEIA president and CEO. "Solar continues to be the fastest-growing source of renewable energy in the United States. By 2016, the U.S. will be generating enough clean solar energy to power 8 million homes. That means solar will offset 45 million metric tons of damaging carbon emissions -- the equivalent of removing 10 million cars from our roads and highways."

GTM Research forecasts that PV installations will reach 7.9 gigawatts in 2015, up 27 percent over 2014.

Key Findings From the Q1 2015 U.S. Solar Market Insight Report

-The U.S. installed 1,306 megawatts of solar PV in Q1 2015, marking the sixth consecutive quarter in which the U.S. added more than 1 gigawatt of PV installations.
-The residential and utility PV market segments each added more capacity than the natural gas industry brought on-line in Q1 2015.
- Collectively, more than 51 percent of all new electric generating capacity in the U.S. came from solar in Q1 2015.
- 66,440 individual solar systems came on-line in Q1 2015, bringing the total to nearly 700,000 nationwide.
- The average cost for a residential solar system is now $3.48/watt, 10 percent lower than this time last year.
-More than one-third of all community solar installations have come on-line since 2014.
-More than 5 gigawatts of centralized PV has now been procured by utilities based on solar's economic competitiveness with fossil-fuel alternatives.
- Through Q1 2015, nearly one-fourth of cumulative residential solar installations have now come on-line without any state incentive.
- PV installations are forecast to reach 7.9 gigawatts in 2015, up 27 percent over 2014. Growth will occur in all segments, but will be most rapid in the residential market.

For more information, download the free executive summary at http://www.greentechmedia.com/research/ussmi.

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