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U.S. Solar Markets Hit Record Growth in 2008 (posted 4/7/09)

April 7, 2009
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The Solar Energy Industries Association (SEIA) recently released its “2008 U.S. Solar Industry Year in Review,” which highlights a third year of record growth for the industry. The report notes that 1265 megawatts (MW) of solar power of all types were installed in 2008, bringing total U.S. solar power capacity up 16% to 9183 MW. The 2008 figure included 342 MW of solar photovoltaic (PV), 139 MWTh (thermal equivalent) of solar water heating, 762 MWTh of pool heating, and an estimated 21 MW of solar space heating and cooling.

“Despite severe economic pressures in the U.S., demand for solar energy grew tremendously in 2008,” said Rhone Resch, president and chief executive officer of SEIA. “Increasingly, solar energy has proven to be an economic engine for this country, creating thousands of jobs, unleashing billions in investment dollars and building new factories from New Hampshire to Michigan to Oregon.”

Rates of growth beat last year’s as well, with the grid-tied PV segment leading with a growth rate of 81% for the amount of installed power in 2008 (292 MW) over the amount installed in 2007 (161 MW). Solar water heating installation grew at a 50% rate in 2008 (139 MWTh) over 2007 (93 MWTh), and pool heating growth slowed by 3% in 2008 (762 MWTh) from 2007 (785 MWTh).

No new concentrating solar power plants came online in the U.S. this past year, but projects now in the pipeline add up to more than 6 gigawatts (6000 MW). Among these are projects planned for California’s Mojave Desert, Arizona and Florida. Four gigawatts of solar energy can power up to a million households.

“To maintain our industry’s growth, create jobs and meet President Obama’s goal of doubling renewable energy production in the next three years, we need smart federal policies, such as a renewable portfolio standard with a specific solar provision that helps to develop and deploy vast solar resources around the country,” said Resch. “Today’s solar technology combined with the right policies will help us double solar production in the United States and move us to a clean energy future.”

States that led in grid-tied PV installation were California (178.6 MW), New Jersey (22.5 MW), Colorado (21.6 MW), Nevada (13.9) and Hawaii (11.3 MW). For solar water heating systems, Hawaii led states, installing 37% of the total U.S. systems in 2008, followed by Florida (20%), California (7%), Colorado (5%) and Arizona (5%). The Mid-Atlantic States, an important emerging region for solar, installed 7% of solar water heating systems.

Several states added or expanded incentives or requirements for solar energy, including California, Hawaii, Maryland, Massachusetts, Missouri and Ohio. To date, 28 states have renewable portfolio standards that require a certain amount of energy to be generated from renewable sources, with 19 of these states mandating that a portion comes from solar or distributed sources. (Distributed generation occurs on land and buildings close to where the energy is used, as opposed to central station power that is transported via power lines.)

A total of 42 states and the District of Columbia now have net metering rules allowing owners of solar energy systems to sell excess electricity back to the grid. However, these rules differ from state to state, and a unified national policy is necessary.

The U.S. solar industry increased domestic PV manufacturing capacity by 65%, creating needed jobs in states such as California, Michigan, Ohio, Oregon and Tennessee as they increased production capacity to 685 MW.

“The growth of solar manufacturing jobs in the U.S. was a breath of fresh air for communities hit hard by the recession,” said Roger Efird, chairman of SEIA and president of Suntech America, Inc. “The recently enacted manufacturing tax credit will give further incentive to manufacturers…to invest in new operations in the U.S. With the right policies, solar deployment will continue robust growth and thousands of new green-collar jobs in manufacturing will be created in states where jobs are needed most.”

The Emergency Economic Stabilization Act of 2008 included an eight-year extension of the federal solar investment tax credit that has spurred U.S. market growth over the last three years. This long-term extension will facilitate the long-term planning and investment necessary for the U.S. solar industry to reach its full potential.

The American Recovery and Reinvestment Act of 2009 also included several provisions that should support continued growth in solar deployment, including a 30% grant program for commercial and utility-scale solar installations to be administered by the Department of Treasury, a Department of Energy loan guarantee program, and a 30% manufacturing investment tax credit to attract investors to the U.S. market. Other policies being debated at the national level (i.e., electric transmission infrastructure, national RPS and global warming legislation) would also stimulate continued growth of the industry.

The full report is available at www.seia.org.

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