Solar energy poised for an unforgettable year

WASHINGTON — Statistics just released by the U.S. Energy Information Administration suggest that in the coming year, the booming solar sector will add more new electricity-generating capacity than any other — including natural gas and wind.

EIA reports that planned installations for 2016 include 9.5 gigawatts of utility-scale solar — followed by 8 gigawatts (or 8 billion watts) of natural gas and 6.8 gigawatts of wind. This suggests solar could truly blow out the competition, because the EIA numbers are only for large or utility-scale solar arrays or farms and do not include fast-growing rooftop solar, which will also surely add several additional gigawatts of capacity in 2016.

In other words, U.S. solar seems poised for not just a record year but perhaps a blowout year. Last year, in contrast, solar set a new record with 7.3 gigawatts of total new photovoltaic capacity across residential, commercial, and utility scale installations.

“If actual additions ultimately reflect these plans, 2016 will be the first year in which utility-scale solar additions exceed additions from any other single energy source,” says EIA.

Justin Baca, vice president for markets and research at the Solar Energy Industries Association, said he agrees with EIA’s figures — though the industry group expresses them in direct current (DC) versus alternating current (AC), and so projects a total of 11.8 gigawatts of utility-scale solar photovoltaic installations, a number Baca calls “completely consistent” with EIA’s. On top of that, meanwhile, SEIA expects to see an additional 4 gigawatts of residential and commercial solar additions, for over 15 gigawatts in total, Baca said.

“Solar’s going to be the decisive leader in terms of capacity additions, for 2016,” Baca said.

The reason this is occurring, however, is not a simple reflection of solar’s growing popularity, or its widely agreed upon role in helping to battle climate change. Rather, it involves that darling of the industry, the 30 percent solar investment tax credit, which was extended late last year for five years, with a gradual phaseout.

Before its recent extension, the credit was set to phase out at the end of 2016. Accordingly, to make sure they captured the credit, a large number of installations had been planned to close by the end of this year.

“For the past eight years, the expectation had been that you were going to get your system done this year, otherwise the cost of the system in 2017 was going to be much higher,” Baca said. Now that the credit will actually not phase out, many of those already planned installations are going ahead on time. “Had the tax credits been extended earlier, people might have relaxed their timelines,” he said.

This logic means that 2017 won’t see as many installations as 2016 – but Baca thinks the industry will keep growing and that by 2019, will climb back to 2016’s high.

However, given the extension of the credit, it could be that 2016 actually ends a little lower than it would have otherwise, according to Nathan Serota, a solar industry analyst with Bloomberg New Energy Finance. But he concurs that there should still be a record year. “It’s going to be big,” Serota said. “The floor on 2016 will be over 9 gigawatts” including all types of solar installations, he said.

Serota says the tax credit extension means there could actually be only a slight difference between 2016 and 2017, if enough projects get pushed off until next year. “2016 is going to be a huge year, and then we’re going to continue to see big years over the next 5,” he said. Granted, solar could still face some headwinds, particularly from the competition offered by extremely low natural gas prices.

In the grand scheme, the tax credits for solar, as well as an extension of the production tax credit for wind, could serve as a kind of “bridge” into an era in which the Obama administration’s Clean Power Plan is operating – or at least, so the current administration hopes. Granted, that depends on whether that plan survives its current legal challenges.

A recent report from the National Renewable Energy Laboratory found that due to the tax credit extensions, the U.S. will add 53 additional gigawatts of renewable energy capacity by the year 2020.

Talk to us

More in Local News

Analisa Paterno of Marysville-Getchell, left, shares a laugh with Nathan Harms Friday morning at Pathfinder Manufacturing in Everett, Washington on September 23, 2022.  (Kevin Clark / The Herald)
Sky’s the limit: Snohomish County teens help build parts for Boeing

Pathfinder Manufacturing in Everett trains dozens of at-risk high school students to make airplane parts, en route to a career.

Fred Safstrom, CEO of Housing Hope, is retiring. Photographed in Everett, Washington on October 5, 2022.  (Kevin Clark / The Herald)
Housing Hope CEO reflects on 25-year career helping unsheltered people

“People used to believe homelessness was caused by bad choices.” Minds and policies are changing, Fred Safstrom said.

Vehicles exiting I-5 southbound begin to turn left into the eastbound lanes of 164th Street Southwest on Wednesday, Aug. 17, 2022, in Lynnwood, Washington. (Ryan Berry / The Herald)
Traffic backups on 164th Street near I-5 could see relief soon

The county and state are implementing a new traffic signal system that synchronizes the corridor and adjusts to demand.

Rick Winter (left) and Gary Yang, the founders of the former UniEnergy Technologies, stand with one their latest batteries, the Reflex, August 10, 2022. (Dan DeLong/InvestigateWest)
‘Chaotic mess’: Clean energy promises imploded at Mukilteo battery maker

UniEnergy Technologies absorbed millions in public funds, then suddenly went dark. The company is accused of providing tech to China.

Everett
Federal funds could pay for Everett bathrooms, gun buyback, more

City officials propose $7.95 million of American Rescue Plan Act money on a shelter, mental health support and more.

Community Transit chief financial officer Eunjoo Greenhouse
Community Transit hires King County staffer as CFO

Eunjoo Greenhouse is set to join the agency Oct. 24 after years in King County government.

Logo for news use featuring the municipality of Lake Stevens in Snohomish County, Washington. 220118
Highway 9 in south Lake Stevens to close overnight this weekend

The highway will be closed between 20th Street SE and 32nd Street SE. Through traffic should use Highway 204 and U.S. 2.

Everett
Everett aims to ‘streamline’ cumbersome process for code violations

The current system costs about $1 million per year to run, but only brings in about $50,000 in fines. Staff suggested changes.

Alexander Fritz is released from handcuffs after being lead into the courtroom Thursday afternoon at Snohomish County Courthouse in Everett, Washington on October 6, 2022.  (Kevin Clark / The Herald)
Team USA climbing coach gets 5 years for child rapes

Alexander Fritz, 28, engaged in “inappropriate relationships” with 15-year-old girls, he admitted in Snohomish County Superior Court.

Most Read