US Solar Market Insight: Q3 2017
In Q2 2017, the US solar market installed 2,387 megawatts direct current (MWdc), which ranks as the largest second quarter ever for US solar. Utility PV accounted for 58% of Q2 2017 installations, which marks the seventh consecutive quarter that the utility-scale space added more than 1 GWdc.
Although all three segments of US solar experienced quarter-over-quarter growth in Q2 2017, non-residential PV is the only segment expected to actually grow on annual basis this year.
Non-residential PV is expected to grow 9%, following a record-shattering 58% growth in 2016. This continued growth in 2017 is partly due to community solar which remains on track to add more than 400 MWdc, nearly doubling community solar installations from 2016. Equally important, across major state markets, revisions to state incentive programs, virtual net energy metering rules, and solar-friendly rate structures have pulled in demand from the out years into 2017.
Meanwhile, residential PV is still expected to fall year-over-year for the first time ever. Several factors are behind this downturn. First, segment-wide customer acquisition challenges are constraining growth in major state markets. Second, national residential solar companies have slowed operations and pursued more profitable sales channels at the expense of growth. Meanwhile, growth in emerging state markets has not made up for weakness across the top 10 state markets.
Finally, utility solar's 2017 downturn has been softened by projects that pushed out their completion dates from 2016 as a result of the 30% federal Investment Tax Credit extension, which represent more than 50% of this year's utility PV forecast. Looking ahead, the recovery for utility solar is primarily driven by procurement outside RPS, with more than 75% of the current pipeline coming from voluntary procurement, PURPA, off-site corporate procurement, and California-based community choice aggregators.
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Delivered quarterly by GTM Research, a Wood Mackenzie business, the US Solar Market Insight is a collaboration between the Solar Energy Industries Association® (SEIA®) and GTM Research that brings high-quality, solar-specific analysis and forecasts to industry professionals in the form of quarterly and annual reports.
Each quarter, GTM Research gathers a complete account of industry trends in the US photovoltaic (PV) and concentrating solar power (CSP) markets via comprehensive surveys of installers, manufacturers, utilities and state agencies. The result is the most relevant industry data and dynamic market analysis available.