The Kansas City Star has described 2011 as 'a historic year for the American solar industry'. According to to a recent study by Solar Energy Industries Association (SEIA) and GTM Research, Solar PV installations across the United States doubled in 2011. The installations have been valued at $8.5 billion which represents an increase of 70% over 2010. The report's Executive Summary commented: "After a record-breaking 2011, the U.S. has proved itself as a viable market for solar on a global scale, "In 2011, the U.S. market's share of global (photovoltaic) installations rose from 5 percent to 7 percent and should continue to grow. We forecast U.S. market share to increase steadily over the next five years, ultimately reaching nearly 15 percent in 2016."
Rhone Resch, president and CEO of SEIA said "We're seeing an incredible increase in the number of utility-scale projects. There's technology acceptance of solar by utilities and companies that traditionally built natural gas power plants. Solar is the next great opportunity."
Federal and state subsidies and clean energy policies have been identified as the main drivers of demand along with falling solar PV prices and cheaper systems. A global oversupply of solar manufacturing capacity has also helped to drive down prices which fell by 50% last year with a 3.6% reduction in price for domestic systems, 14% for commercial systems and 21% for larger utility systems. Overall this has led to increased interest in investment, particularly by large energy companies such as NRG Energy Inc, NextEra Energy, Exelon and MidAmerican Energy Holdings, which is a subsidiary of Berkshire Hathaway Inc.
The report also found that US solar manufacturing had fallen by 4% over 2011 compared to 2010 with production of polysilicon remaining flat at 40,600 tons. It predicts growth in installations to reach 15% of the global solar panel market by 2016 with the US and China increasingly overtaking Europe as the leading markets.
California remains the largest US solar market having installed 542 MW representing 29 percent of all installations throughout the US. New Jersey, Arizona and New Mexico follow close behind while New York has moved into the top ten for the first time and Texas moves to ninth place. Despite this, solar energy in California still provides less than 1% of the state's electricity, which has thus far been generated by burning natural gas alongside nuclear power and hydroelectricity. Governor Jerry Brown however wants solar to become an important part of California's energy future, partly because of the potential for job creation in the state. He hopes that solar will create 12,000 MW of rooftop energy generation by 2020. California's Renewable Portfolio Standard calls for 33 percent of electricity to be generated from renewable sources by 2020.