Solar Tipping Point

This post is part of a series in which LinkedIn Influencers analyze the state and future of their industry. By Jigar Shah, founder SunEdison.
 

In 2003, I was beating my hand against doors to convince businesses to install solar, and my head against the wall trying to get investors to put their money into no-money-down solar contracts.

Eleven years later, I am watching people who are now switching to solar. However, the solar switch is not based only on their values – these energy consumers are also simply anxious to save money on energy. When and where solar makes economic sense, it is being deployed. And the places to deploy it are increasing – 300 utilities in 30 states are now cost-effective for solar power.

The result is that the state of the solar industry has never been better. The facts and figures below reflect that solar has hit the tipping point.

29 Percent

Solar accounted for 29 percent of all new electricity generation capacity added in 2013, up from 10 percent in 2012. Solar was the second largest source of new electricity generating capacity behind natural gas. In ten states, including Illinois and Missouri, solar power represented virtually 100 percent of new electrical capacity added in 2013.

2.2 Million Homes

There is now enough solar capacity to power more than 2.2 million average American homes. Cumulative solar electric capacity operating in the U.S. reached more than 13,000 MW.

Solar is Cheaper

Year-over-year, the national average solar PV (photovoltaic) installed system price declined by 15% to $2.59/W in Q4. The average price of a solar panel has declined by 60 percent since the beginning of 2011.

2014, Another Record Year

Close to 6,000 MW of solar PV is forecasted to come online throughout 2014, which represents 26% growth over 2013’s record installation totals.

2014 will be a record year for CSP (concentrating solar power) as 840 MW are expected to be commissioned by year’s end.

Together, new solar electric capacity projected to be added in 2014 will generate enough clean energy to power over 1.13 million average American homes.

143,000 Solar Workers in the U.S.

According to The Solar Foundation’s Solar Job Census 2013, there are nearly 143,000 solar workers in the U.S., a nearly 20 percent increase over employment totals in 2012. These workers are employed at 6,100 businesses operating at over 7,800 locations in all 50 US states and territories. The solar industry is expecting to hire for over 2,000 new jobs per month in 2014. The increasing value of solar installations has injected life into the U.S. economy as well. In 2013, solar electric installations were valued at $13.7 billion, compared to $11.5 billion in 2012 and $8.6 billion in 2011.

The Top Ten States:

According to SEIA’s U.S. Solar Market Insight 2013 Year in Review, the Top 10 Solar States based on solar capacity installed in 2013 are as follows:

  • California
  • Arizona
  • North Carolina
  • Massachusetts
  • New Jersey
  • Hawaii
  • Georgia
  • Texas
  • New York
  • Colorado

Solar Tipping Point

Being able to report these numbers is a thrill. For me, solar started an uphill battle to convince top companies to install it. Today, companies like Walmart, Kohl’s, and Staples are the largest users of solar power in the United States. With rapidly rising electricity rates, solar is turning out to be the right technology at the right time. It is making solar a no-brainer for many businesses and residents – even if you are only installing solar to save money.

Yes, solar has reached its tipping point moment as defined by Malcolm Gladwell.

Solar Now Costs Much Less

We’ve just received a copy of a new study by SolarCity and CleanEdge. It’s a broad survey of American attitudes about solar, renewable energy, and clean energy. We felt these results were important enough to share. Some excerpts from the report appear below, and the full report can be found here.

The most surprising and important finding involves perception. Only 45% of American homeowners believe that solar power is more affordable today than it was three years ago—even though during the past several years prices for solar panels dropped by more than half. Perhaps the solar industry has been slow to communicate effectively just how far solar prices have dropped. Here is one example:

  • Recently, we quoted a homeowner $25,990 for a 9.12kW rooftop solar electric system
  • 3 years ago, we quoted that same homeowners $49,263 for a 7.2kW system on the same rooftop
  • This example system represents an almost 50% price drop!

Other key highlights from the 2014 U.S. Homeowners on Clean Energy Survey include:

Homeowners Want Energy Options

  • Majority of homeowners (69%) want more choices when it comes to their energy and electricity supply.
  • Three out of four respondents believe that utilities should not be able to block individual residential customers from installing distributed solar power, energy storage, and other onsite systems. Such sentiments were strongest among respondents that identified themselves as Republicans, Conservatives, the middle-aged (55-69), and elderly (70+), at 80%, 83%, 89%, and 94%, respectively.
  • 73% of homeowners would welcome an inexpensive and reliable form of energy provided by someone other than their current utility.
  • 62% of  homeowners want solar power for their homes.
  • 50% of homeowners are interested in backup power for their homes.

Support for Renewable Energy is Strong and Widespread

  • 88% of homeowners believe that renewable energy is important to America’s future.
  • Support is high among all major political affiliations,with respondents that identified themselves as Republicans, Democrats, and Independents coming in at 87%, 93%, and 83%, respectively.

Homeowners Weigh Environmental Impact, but Economics Rule

  • Homeowners say they care about the environmental impact of their car, home, and other major purchases. 70% consider or investigate the environmental impact/sustainability of big-ticket items when making purchasing decisions.
  • Such environmental considerations are increasing. Nationwide, more than half of homeowners said they were more likely to make such considerations today than three years ago.
  • While homeowners say they care about the environment, economics drive most purchasing decisions. Respondents cite zero up-front costs and ongoing cost savings as the top two reasons for considering a solar power installation.

Clean-Energy Purchases are Becoming Mainstream, but Perceived Price Barriers Persist

  • Perceived price barriers have kept some homeowners from adopting clean-energy products. Less than half of all homeowners nationally (45%) believe that solar power is more affordable today than it was three years ago—even though during the past several years prices for solar panels dropped by more than half.
  • As noted above, homeowners state that low up-front costs, and savings over time, would drive increased adoption of solar power and other clean-energy purchases.

This report brought to you by SolarCity and Clean Edge in collaboration with NASDAQ