Solar Installation Growing Quicker Than in the Past

As noted in previous energy blogs, solar power can be both a boon and a bane for electric utilities. It can be a boon when utilities build and connect their own solar farms to the grid, and/or use solar power to completely or partially power microgrids on their distribution networks.

It can be a bane when customers (industrial, community, commercial, governmental, and residential) purchase their own solar units to generate their own power and be either completely or partially off the grid.

So, the latest news from the U.S. Energy Information Administration (EIA) can be seen as both good news and bad news for utilities.

According to the EIA, solar power is the fastest-growing source of new electricity generation in the United States because of falling costs, tax credits, and other policies that provide incentives for adding renewable energy sources.

The U.S. electric power sector reported fewer delays to install new utility-scale solar photovoltaic (PV) projects in 2023 than in 2022. In 2023, solar developers pushed back the scheduled online date for an average of 19 percent of planned solar capacity compared with an average of 23 percent in 2022. Although the share of solar capacity reporting delays fell in 2023, it was still higher than the average share of delays between 2018 and 2021.

The number of developers reporting project delays can vary greatly from month to month. However, the percentage of total planned solar capacity with a postponed operational date trended upward throughout 2021 and 2022, reaching a peak at 33 percent of planned capacity delayed in December 2022.

“The decrease in delays came at a time when utilities were adding more solar to the grid,” said the EIA. “In 2023, the electric power sector began operating 19 gigawatts (GW) of new utility-scale solar PV generating capacity, a 27% increase from the existing solar capacity at the end of 2022.”

According to an analysis of generator project interconnection timelines by the Lawrence Berkeley National Laboratory, the median length for a solar project is 25 months, from the signing of an interconnection agreement to the commercial operation date.

Projects can be delayed for several reasons, including complications involving permits, construction, or equipment testing. One key factor affecting solar panel installations is the availability of building materials.

U.S. trade policy can also affect solar deployment. U.S. tariffs that affect Chinese manufacturers of solar PV cells and modules in China are suspended by a White House proclamation until June. Once the proclamation expires, imported crystalline silicon from China and certain companies operating in Cambodia, Malaysia, Thailand, and Vietnam will again be subject to tariffs.

“Our latest information indicates that the electric power sector added about 6 GW of net summer solar capacity in the first quarter of 2024,” said the EIA. “For solar projects that developers plan to have operational before the end of 2024, about 24 GW is in the testing or construction phase, and about 6 GW is in the permitting or planning stage. Another 26 GW of new solar capacity is scheduled to come online in 2025, most of which is in the permitting stage.”


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