Heidi Strawn
April 1, 2011

Solar panels

Courtesy Hemera/Thinkstock

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The solar industry aims to power 2 million U.S. homes by 2015. 

Solar was a bright spot in the U.S. economy in 2010 as the fastest-growing energy sector.The U.S. solar-energy industry’s total market value grew 67 percent from $3.6 billion in 2009 to $6 billion in 2010, according to the U.S. Solar Market Insight: Year-in-Review 2010 report released by the Solar Energy Industries Association and GTM Research.

In total, 878 megawatts of photovoltaic capacity and 78 megawatts of concentrating solar power were installed in the U.S. in 2010—enough to power roughly 200,000 homes. In addition, more than 65,000 homes and businesses added solar water-heating or solar pool-heating systems.

The U.S. photovoltaic market made the most significant strides in 2010, with installation totals more than doubling from 2009, according to the U.S. Solar Market Insight report. This expansion was driven by completion of significant utility-scale projects, expansion of new state markets, declining technology costs and the federal treasury’s section 1603 grant program.

The 1603 program, a U.S. grant program for solar- and renewable-energy projects, helped fourth-quarter installations surge to a record 359 megawatts and was critical in allowing the solar industry to employ more than 93,000 Americans in 2010. Originally set to expire at the end of 2010, the 1603 Treasury program was extended through 2011.

In addition, market diversification was a distinguishing characteristic of U.S. solar-energy development in 2010. Sixteen states each installed more than 10 megawatts of PV in 2010, up from only four in 2007. The top-10 states for PV installation in 2010 were California, New Jersey, Nevada, Arizona, Colorado, Pennsylvania, New Mexico, Florida, North Carolina and Texas.

Cost declines were also an important factor in the 2010 solar expansion as technology costs fell and the industry matured further, capitalizing on greater economies of scale and improved installation practices. In the residential segments, installed annual PV-system costs declined 8 percent.

“The U.S. PV market saw a breakthrough in 2010 and is emerging as a global demand center for both suppliers and project developers,” says Shayle Kann, managing director of solar at GTM Research.

According to Rhone Resch, SEIA president and CEO, the report shows that solar energy is one of the fastest growing U.S. industries, offering growth opportunities to businesses of all sizes.

 “This remarkable growth puts the solar industry’s goal of powering 2 million homes annually by 2015 within reach,” he says. “Achieving such amazing growth during the economic downturn shows that smart policies combined with American ingenuity adds up to a great return on investment for the public.”

Along with analysis of the U.S. PV market, U.S. Solar Market Insight: Year-in-Review 2010 provides visibility into the concentrating-solar-power and solar heating-and-cooling markets. The 75-megawatt Martin concentrating-solar-power plant installed in Florida is the largest to go online in nearly 20 years and foreshadows a pipeline of more than 9 gigawatts of concentrating-solar-power projects under development. In addition, 2010 marked the first time the federal government approved permits for concentrating-solar-power plants on public land. 

Meanwhile, the solar heating-and-cooling markets grew in 2010. The top-five states for solar water-heating installations in 2010 were California, Hawaii, Arizona, Florida and Puerto Rico, while the top five for solar pool heating were Florida, California, Arizona, New York and Illinois. Fluctuating natural-gas and heating-oil prices will determine the future of these markets.

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