US solar celebrates records in 2013, big trends coming in 2014

New Hampshire, USA -- Solar photovoltaic (PV) installations in the U.S. topped 4.78 GW in 2013, an increase of 41 percent over 2012, according to the annual market review and outlook published today by the Solar Energy Industries Association (SEIA) and GTM Research.

The industry won't quite maintain that torrid pace in 2014, but watch for progress on a number of important fronts, from long-anticipated investment innovation to a rebound in the midsize project sector to addressing changes to federal investment tax credits.

More than 2.1 GW of that 4.7 GW was added in the final three months of the year, which is by a long shot the sector's largest quarterly tally. Concentrating solar PV (CSP) also had a big year, bringing 410 MW of capacity online and like PV a big chunk of that was added late in the year. Approximately 140,000 individual solar installations were put up during the year, making solar energy the nation's second-largest source of new generation (29 percent) behind only natural gas.

"We're putting real megawatts in the ground, making real contributions to electricity generation, and contributing to a real economic result," said Arno Harris, SEIA board president and CEO of Recurrent Energy, in a conference call discussing the report results.

Cumulative solar PV installations in the U.S. are now 12.1 GW, plus another 918 MW of concentrating solar (CSP). Put another way, U.S. solar PV added roughly 40 percent to its cumulative capacity during 2013, while CSP hiked its cumulative capacity by 80 percent. Total individual solar installations now exceed 440,000. The solar PV market's size also grew substantially, from $11.5 billion in 2012 to $13.7 billion in 2013.

What's equally or perhaps even more important than the record 2013 numbers was the broad support and adoption of U.S. solar energy, illustrated by strong customer adoption and grassroots support, increasingly favorable financing terms, and success stories in the public markets. Quite simply, it was "the first real glimpse of [U.S. solar's] path toward mainstream status," suggested Shayle Kann, SVP at GTM Research, in the report.

States On the Move

Five states represented 81 percent of all U.S. PV installations in 2013: California, Arizona, North Carolina, Massachusetts, and New Jersey. Ten states saw more than three-quarters of new electric capacity come from solar -- and for six of them (plus Washington D.C.) it was the *only* new generation.

U.S. solar installations in 2013 by state and market segment. Credit: SEIA/GTM Research

No surprise that California is leading the way, with over 2.6 GW of installations representing more than half of the nation's solar capacity in 2013 — and more than the entire nation installed in 2011. Arizona came in a distant second at 421 MW, which is a far cry from the 710 MW it installed in 2012. Other high growth solar states in 2013 included North Carolina, Massachusetts, and Georgia, collectively more than doubling their 2012 totals with 663 MW installed.

Highlighting individual states, Resch pointed to North Carolina which soared to the No. 3 spot, more than doubling its installed PV capacity to 35 MW, mostly because of commercial-scale additions, both small (e.g. 20 MW at Apple's Maiden data center.) Massachusetts, meanwhile, rose 76 percent to 237 MW and is now the nation's top commercial-scale solar PV installer, thanks largely to stabilizing policies including continued SREC programs. Resch also called out energy-hungry Texas, which traditionally has had a bigger appetite for wind than solar despite excellent resources for both. "It's going to be a very strong market for solar going forward," mainly for utility-scale projects and because of easier connections to existing transmission lines, he said.

Breaking Down the Markets

Residential solar grew 60 percent in 2013 to 792 MW of installed capacity, reflecting numerous policy victories most notably net metering in Arizona and California. It was a continued evolution in residential solar installation strategies, from new emerging partnerships to home service providers (including cable companies) entering the mix. Reiterating the year-end boom for all of U.S. solar installations, the 33 percent spike in residential solar during 4Q was by far the largest month/month increase in several years, primarily attributed to California.

Non-residential solar (commercial, government, schools, nonprofits) ended up basically flat in 2013, up just 4 percent for the year to 1.11 GW, but only because of a massive 78 percent spike in the fourth quarter, as three nonresidential-heavy states shrank (Arizona, California New Jersey). 2013 was "a massive year" for utility-scale solar, which added 2.8 GW of installed capacity, nearly half of that in the final quarter of the year, reflecting the volume of large projects that have progressed for years through the development pipeline. [Article continues on next page.]

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