The American solar power market has recorded a boom and is growing faster than coal and natural gas power.
In the past, the solar energy market in the US has not been reliable due to unpredictable federal policy which deprived them of incentives to produce and install solar energy systems. But today, new federal and state policies as well as a favourable economy, has improved its lot.
Jigar Shah, president and co-founder of Generate Capital, a clean energy investment firm based in San Francisco says: “I think it will actually be bigger than people are projecting… The solar industry is booming right now.”
According to a market report by GTM Research and the Solar Energy Industries Association, 14.5GW of solar power is expected to be installed in the US in 2016, which represents a 94 % increase over the record 7.5 gigawatts last year.
According to the US Energy Information Administration, new solar is expected to surpass installations of all other sources in 2016.
The solar industry has started shifting with the rise of solar use by homes and businesses with roof PV panels, helped by a federal tax credit enabling owners to take off 30 per cent of the price of their solar installation from their income taxes, and the decline of other sources of energy such as coal.
The cost of components for solar installations has also recently declined significantly, the wholesale price of a solar panel being about $0.65 per watt today, compared with $0.74 per watt in 2015 and $4 in 2008.
Despite its fast growth in the market, there are still some hiccups.
Though the US is now one of the top 5 nations for solar panels production after China, Singapore, Taiwan and Malaysia, the solar industry remains unsure due to the changing governmental policies.
Another major snag is the need for more energy storage capacity, because of the need for solar energy even when the sun does not shine, and the scale of battery technology is not improving quickly enough for it to become financially viable for masses.
Tesla Motors is working on the problem with lithium-ion batteries in a massive factory in Nevada for energy storage packs designed by Tesla for homes and businesses.