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.