SEIA and GTM Research have released an analysis of the U.S. solar industry from the first quarter of 2012. Overall the market is booming, but manufacturing is struggling.
Good News
-More than 545 MW of solar was installed during Q1 2012, which is up 100% – doubled – from the first quarter of 2011. –Sector installations are up as well: residential is up 31% from Q1 2011, commercial is up 81% – nearly doubled – from Q1 2011, and utility is up 312% – tripled – from Q1 2011.
-Developers installed 85% more solar panels in the U.S. in the first quarter than a year earlier.
Tom Kimbis, VP of SEIA says an 85% growth rate for solar is encouraging in this economy. He says he expects growth to continue to pick up for the rest of the year. “Solar is now a significant part of our nation’s energy portfolio,” he says.
Kimbis says such solar growth is due to two factors. First of all is cost. Solar has become more affordable for consumers. Also, solar policy, such as the 30% ITC has spurred growth. But Kimbis fears solar has become a “political football for candidates to toss back and forth.”
“It’s technology, not a political issue,” he stresses. “Solar employees 100,000 Americans in 5,600 companies, most being small businesses. Candidates need to realize solar is a way to create jobs and help the economy.”
Not-So-Good-News
“The report isn’t completely rosy,” Kimbis says, “especially on the manufacturing side.” According to the report, domestic manufacturing production numbers for virtually all segments of the industry continued to fall during the quarter – both from the same period last year and from prior quarter numbers. “The economy isn’t in great shape globally,” Kimbis explains, “and solar is global industry. There is a huge global over supply of panels right now so we expect manufacturing problems to continue at least through 2012.”
Shayle Kann, VP of Research at GTM, agrees that this is a difficult time to be a solar manufacturer, no matter what country you’re in. “The substantial global oversupply of solar panels has caused prices to fall to 94 cents per Watt,” he says. “This is the first time we’ve seen prices fall below $1.00.”
Other Notes
While California has been the leader in solar installations for decades, New Jersey actually surpassed the state for most solar installed during the quarter (173 MW vs 148 MW), marking it the second quarter in a row where California was not the leader (in Q4, 2011, Arizona topped CA). New Jersey also had some of the lowest residential and commercial installed prices in the country, which no doubt helped push installations. The state is struggling with balancing supply and demand, but it’s expected these issues will be worked out in time.
SEIA also says there was slow down in installations for notoriously solar states such as Hawaii, California or Arizona.
Kimbis says states that are doing well are not doing so by accident. States excelling in solar are those which allow home owners and business to have solar on roofs and interconnect systems to the utility. These states allow participation in net metering programs. “Such pro-solar policy states are the ones moving ahead,” he says.
