Opportunities for the PV industry in USA

In recent years, the U.S. market has been driven primarily by the non-residential sector, which accounted for over 50% of total installations through 2008. However, the utility sector has been gaining ground (28% market share in 2010) while residential remained relatively steady around 30% of total installations. In the longer term, the U.S. market has the potential to share three vibrant, growing market segments, each contributing a meaningful share of total demand.

- Residential installations fell slightly from Q1 2011 to Q2. This trend is disappointing, but should not be considered indicative of a long-term pattern for the residential market. Most state residential markets were virtually flat over Q1, but downward trends in Colorado, New Jersey, New York, and Pennsylvania pulled down the total. Our forward-looking view on the outlook for the residential market is more positive, principally because the availability of residential third-party financing programs is growing.

- Non-residential installations grew substantially in Q2. However, this overall figure belies the varied trends among individual state markets. For example, California and Colorado non-residential installations fell substantially, while New Jersey and Pennsylvania grew sufficiently to overcome those losses. The outlook for the non-residential market is mixed, with likely continued high installation numbers through the rest of 2011, but far fewer new projects being signed up. In 2012, tax equity will certainly emerge as a bottleneck if the Section 1603 Treasury program is not extended again.

- Utility installations grew 37% to 50 MW in Q2. As always, quarterly installation figures for the utility market carry the least predictive value for future installations. A single 75 MW project could be completed in Q3, surpassing the Q2 total in one fell swoop. The largest project completed in Q2 was Dover SUN Park, an 11.2 MW single-axis tracking project in Delaware. The utility market is currently benefitting from the first half module price declines, which have improved the financial viability of a number of projects.

An Overview of the US Solar Market. Great market to enter!!!

In 2010, the U.S. installed 887 megawatts (MW) of grid-connected PV, 104% growth over the 435MW installed in 2009. In 2011, a first-half slowdown in major European markets (most notably Italy and Germany) combined with continued strength in the U.S. has already led most PV manufacturers and developers to seek opportunities in the U.S. market with many in the industry expecting the it to be the largest market in the world within a few years.

Leading the way was the U.S. solar photovoltaics (PV) market, which installed 314 megawatts in the second quarter, 69 percent more than the same period last year and 17 percent more than the first quarter of 2011. The U.S. remains poised to install 1,750 megawatts of PV in 2011, double last year's total and enough to power 350,000 homes. "The second quarter data illustrates that the U.S. solar industry continues to be one of the fastest growing in America," said Rhone Resch, president and CEO of SEIA.

Photovoltaics (PV):

 Grid-connected PV installations in Q2 2011 grew 69% over Q2 2010 and 17% over Q1 2011 to reach 314 MW.

 Cumulative grid-connected PV in the U.S. has now reached 2.7 gigawatts (GW).

 For the first time, New Jersey’s non-residential (excluding utility projects) market exceeded California’s, making it the largest non-residential market in the country.

 Six states installed over 10 MW each in Q2 2011 compared to only 3 states in all of 2007.

  A slowdown in global demand led U.S. module production to fall 11% in Q2 from Q1, to 333 MW.

 Weaker-than-expected global demand conditions also led to a price decline in Q2, with wafer and

 Cell prices each dropping 25% and module prices falling 12% on the quarter.

The overall forecast for 2011 has remained relatively unchanged, with an expected near doubling of the U.S. market during a period of continued macroeconomic woes and a slowdown in many major global PV markets. The flatness of the overall forecast masks substantial revisions within both market segments and states. Principally, residential and utility forecasts for 

2011 have been revised downward, while non-residential forecasts have received a boost. This is largely a function of the markets which have shown strength thus far in 2011 – particularly New Jersey, which has become a nonresidential- dominated market. The utility forecast has been revised downward based on updates on a number of projects in development that appear likely to have their commercial operation dates moved back to 2012. Ultimately, the non-residential market is anticipated to exceed the utility market in 2011 and remain the largest market segment in the U.S. However, 2012 will likely be a very different story in which major nonresidential markets (California, New Jersey, and Pennsylvania) see a downturn, while both the residential and utility markets continue to grow. Overall, 2012 is anticipated to be a more difficult year for the U.S. market given declines in a number of major markets and potential Section 1603 Treasury Program expiration.

Annual U.S. grid-connected PV installations doubled in 2010 compared with installations in 2009 to 890 MWDC, raising the cumulative installed grid-connected capacity to 2.15 GWDC (see Figure 1). The capacity of PV systems installed in 2010 was over eight times the capacity of PV installed in 2006. More than 50,000 systems were installed in 2010, a 45% increase over the number installed the year before. In 2010, 262 MWDC were installed on residential buildings, 347 MWDC at non-residential sites and 284 MWDC in the utility sector.