December 11, 2017 Across the country, a growing mix of power is coming from renewable sources with solar energy expected to grow by almost 30 percent by 2018. After reaching 1 million in 2016, solar installations are expected to hit 2 million in 2018 and 4 million by 2022. What are the driving forces behind these PV predictions? As a top solar industry consulting firm in the United States, KMB has the answers.
Solar Growth Predictions
PV Magazine reports, “The latest Electric Power Monthly by the U.S. Energy Information Agency shows solar PV continuing its impressive growth, generating 47% more electricity from January through September 2017 than the same time period in 2016.” Some of the driving factors for the solar industry include solar costs, policy support and attractive tax credits.
Solar Costs
Since 2013, the cost of solar technology has dropped 10 to 15 percent per year. And over the past seven years, the cost of solar installation has dropped by more than 70%. Solar panels are not only performing better than they have in the past due to technology advancements, but construction costs are also coming down, making cost competitiveness one of the main drivers of solar demand.
Renewable Mandates
Another big driver of solar demands include policy support. Over the past several years, we’re seeing renewable mandates across 29 states including Washington, D.C. where an increasing mix of generation is required to come from either solar, wind or other renewable energy resources.
Solar Investment Tax Credit
Another solar industry driver that can’t be ignored is subsidies. Solar demand is also benefiting from subsidies in the form of federal tax credits. Since 2006, in the United States, there’s been a 30 percent Solar Investment Tax Credit (ITC) granted on solar installations. That was actually extended at the end of 2015 to go through this decade and into the 2020s.
One reason tax credits are important is to lower the cost of commercial solar installation. As the cost of capital being less expensive and because the returns are improved by having tax credit embedded, additional demand for solar power continues to be fueled.
KMB- Leading Solar Industry Consulting Firm
Longer-term, solar’s fundamental prospects for continued growth and adoption remain positive in large part due to technology growth that is expected to continue to lower costs and make solar power attractive over the coming years.
Combining vast photovoltaic experience with quality engineering consulting services, KMB continues to be a leader in the solar industry. As a full-service engineering firm licensed in the United States and Europe, we provide a national reach with a local touch and take a systematic approach to develop comprehensive solar engineering solutions that line up with unique client needs.
Contact us to find out how KMB can help your business experience the benefits of going solar.