USA set to become the 3rd Largest Solar market in 2013 after China and Japan

Solar Energy in United States of America is booming like other parts of the world with nearly 1.8 GW of solar capacity expected to be installed in the 4th quarter of this year. This would lead to new capacity installation of nearly 4 GW in 2013, making it the 3rd biggest market after Japan and China. Growth is being powered by both the residential and utility markets. The falling prices of solar energy have led to this rapid growth. The trade sanctions on Chinese solar industry have failed to dampen the growth of solar energy. The reason is that that the 50% decrease in solar installation has been too huge for small irritants to derail the overall solar growth story.

Also Read on GWI Solar Panels Manufacturers in USA.

While USA has already been a great solar ground mounted market with some of the world’s largest solar farms located in California and Arizona, innovative financing models have led to a rapid growth in the residential and commercial market. The 30% investment tax credit for solar installations has been used to the hilt by solar financers cum installers such as SolarCity, Sunpower and others. They have tied up with big banks and companies such as Google to use the tax credit. They are accelerating the adoption of solar energy by removing the major hurdle of large upfront payments. Large solar tax funds have been created which allow homeowners to pay a monthly fee for electricity for solar power. Most USA states are also allowing net metering which has led to an explosion of rooftop solar installations in the US. This has threatened the large utilities, which are trying to reduce the growth through use of special fees. However, I think it is a losing battle as solar prices continue to go down and fossil fuel prices continue to go up. One major firm has predicted that solar utility prices will go below that of natural gas by 2025. Given the rapid pace of technology improvement in solar energy, I think that the day will come much sooner.

USA will be one of the biggest markets as it has the biggest electricity capacity in the world with around 1000 GW. This means that solar energy has a potential of around 4000 to 5000 GW in terms of replacement alone. 4 GW is just the tip of the iceberg. China is already going the whole hog with 10 GW of capacity being the annual target and Japan has also shown a triple digit growth with 6 GW expected to be installed. I would remain very bullish on the USA solar market for the long term.