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Solar Power Just Had Its Biggest Quarter Ever

By Jeff Spross

"Solar Power Just Had Its Biggest Quarter Ever"

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Bobby Bailey

CREDIT: AP Photo / Bob Leverone

Solar photovoltaics were the second-largest source of new electricity generation in 2013, according to a new report released Wednesday.

The numbers, collected by GTM Research and the Solar Energy Industries Association (SEIA), show the United States put in 4,751 megawatts of solar photovoltaic (PV) capacity in 2013. That’s 41 percent more than was installed in 2012, and it brings the total amount of solar PV in the country to 12.1 gigawatts — plus 410 megawatts of concentrated solar power, bringing that total to 918 megawatts. And six states plus Washington, DC didn’t install any electrical capacity except solar in 2013.

All told, solar installations made up 29 percent of all the new electrical capacity the country installed last year, second only to natural gas.

seia-solar-new

Back in 2012, solar accounted for only 10 percent of new capacity that year.

Big drops in price helped solar along. The national average cost of a solar installation dropped from $3.05 per watt in 2013′s third quarter — where it had been stuck for almost a year — to $2.59 per watt in the fourth quarter: a fall of 15 percent.

The cost of residential solar installations fell 8.8 percent from the fourth quarter of 2012 to the fourth quarter of 2013. Non-residential installations for commercial buildings and businesses fell 16.3 percent over that same period, and the cost of utility-scale projects fell over 13 percent.

seia-prices-2013

It all added up to the biggest quarter solar in the US has ever had, with 2,106 megawatts of installed capacity in the final months of 2013. That handily beat the previous record of 1,311 megawatts installed in the fourth quarter of 2012. It also means more solar has been installed in the last 18 months in the U.S. than in all thirty years before that.

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The really spectacular growth was obviously in utility-scale installations. Though the report also sees that slowing down slightly, as many state renewable mandates are coming close to fulfilling their current targets, and the federal investment tax credit for solar sunsets in less than three years. Still, the report forecasts that new solar PV installations in 2014 will hit almost 6 gigawatts, and 10 gigawatts in 2016.

Residential solar’s growth was slower but kept on its steady upward trend. That’s mounting a challenge to the traditional model of the electrical market, in which consumers buy their electricity from centralized and highly regulated suppliers, who have a vested interest in keeping out alternatives. As more people get more electricity from their own home-installed systems, the financial model supporting the traditional utility suppliers is breaking down. That will force some eventual changes in regulatory policy.

“If 2013 was about raising the issue, 2014 will be about defining solutions,” the report notes. “Increasingly, solar is not bound by its cost, but rather by its role in the electricity sector.”

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