Image: NREL/Dennis Schroeder
The U.S. solar market passed 100 GW of installed electric generating capacity in the first quarter, doubling the size of the industry over the last 3.5 years, according to the U.S. Solar Market Insight Q2 2021 report, released by the Solar Energy Industries Association (SEIA) and Wood Mackenzie.
The report said that residential solar was down 8% from the fourth quarter of 2020, but up 11% from the first quarter of 2021 with 905 MW installed. The report credited “healthy sales pipelines” that spilled over into the first quarter.
Commercial solar and community solar volumes fell from Q4 2020, as is typical for these market segments. Commercial solar rose 19% over Q1 2020 and community solar fell 15% from Q1 2020.
Utility-scale solar set a record for first-quarter installations at 3.6 GW. Texas made up the largest share of this capacity, with more than 1.4 GW of installations.
A total of 6.2 GW of new utility-scale solar power purchase agreements were announced in Q1 2021, on par with Q1 2020. The total utility-scale contracted pipeline has grown to nearly 77 GW, the report said.
Wood Mackenzie forecasts that the solar industry will continue to break annual installation records every year for the next three years before the investment tax credit (ITC) fully phases down under current law. Another 160 GW of capacity will be installed between 2021 and 2026, bringing the total operating PV fleet to over 250 GWdc by the end of 2026.
Texas led all states with 1.52 GW of new solar capacity in Q1, more than it added in all of 2019 and three times more than any other state. Indiana, Virginia, Michigan, and Iowa were among the top 10 solar states this quarter. Indiana rose from 32nd in terms of new installed solar capacity in 2020 to 4th as of the first quarter. Meanwhile, Georgia fell from 7th place to 38th over the same time period.
The report also calls attention to rising costs in the solar industry and helps to explain the dynamics at play. It said that “compounding cost increases across all materials started at the end of Q1 and are beginning to affect installers now.”