Indian Solar Panel Manufacturers plan to expand capacity even as prices crater – Are they Rational?
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September 29, 2016The next US election will determine the fate of the Energy industry
The US Presidential election is all set to carve the future of renewable energy, solar energy in particular. The campaign has become too exciting not only for the people in USA, but also for the green energy enthusiasts worldwide. The two candidates – Donald Trump and Hillary Clinton are at the two ends of a spectrum when it comes to solar energy.
While Hillary Clinton is ready to march on the solar energy path paved by President Obama, Mr. Trump is adamant to support fossil fuel generation. Mrs. Clinton promises to make America the clean energy superpower of the world, installing 500 million solar panels across the country by the end of her first term. This would entail ~140 GW of solar energy production by 2020, which would be enough to power every home in America in another 10 years’ time. She would also encourage using more efficient cars, ships, and other vehicles, reducing oil consumption.
Mr. Trump however will focus on coal and other fossil fuel generated power. He states solar energy as an “unproven technology” with low ROI and has not accused wind energy of destroying the shorelines. He will cancel the Paris Agreement, Climate Action Plan and other measures taken by President Obama to promote green energy. According to him, this would lead to create 500,000 jobs and increase US annual GDP by $100 billion.
In USA solar accounted for 26% of all new electric generating capacity in H1’16, with residential solar growing 29% y/y marking the largest quarter ever. USA installed 2051 MW of solar power in Q2’16 itself. Community solar is expected to add 100 MW in 2016. According to GTM research, 14 GW of new solar installations will come online in 2016. Solar is growing exponentially around the globe, given its green credentials. This coupled with the fact that the prices are also going down rapidly has paved the growth of solar installations. In USA alone, residential prices have gone down by 2%, while commercial and utility segments witnessed a price fall of more than 5% during Q2’16.
Congress had passed the Investment Tax Credit extension bill in December last year, to support the growth of solar energy. Now it remains to be seen how the industry will move further. Much of it will depend upon the US elections. USA is amongst the largest solar market in the world. Any changes in its policies will affect the overall industry at hand. Biggest beneficiaries of the Hillary Clinton win could be the largest thin film maker First Solar and the largest residential installer SunPower in USA.
1 Comment
hi,
I an CA by profession and has several times calculated the ROI of solar energy plant. i have always considered either cost of conventional sources will be same or increase and accordingly calculated ROI. However whrn i see factual data of last 2-3 years of the world where solar pv power plant are set up in good numbers, found that cost of conventional sources is getting reduced. yes green energy is one of the aspect but the fact is that ROI seems to be difficult to digest. as we see that thier is an outright capex in solar and considering huge cost as of now, i see people installing now will be less benefial compared to people installing after say 5 years, may be then capex get reduce and ROI can be better rather i would say favourable.