Top 10 States for Grid-tied
Photovoltaic Installations in 2008
2007 rank in parentheses*
State Capacity (megawatts-dc)
1. California (1) 182.3
2. new Jersey ( 2) 22. 5
3. Colorado ( 4) 21. 7
4. nevada ( 3) 14. 9
5. hawaii ( 6) 8. 6
6. new York ( 5) 7.0
7. Arizona ( 7) 6. 4
8. Connecticut ( 8) 5. 3
9. oregon ( 11) 4. 8
10. north Carolina ( 16) 4.0
All others 15. 6
* 2007 rankings published in the author’s “Boom times for Solar” article in the July/
August 2008 SOLAR TODAY were based on preliminary numbers and therefore differ
slightly.
state tax credits and high energy prices. By
2008, national installations were nearly four
times the number in 2005, and installations
outside Hawaii increased by seven-and-a-half
times in that time.
In addition to Hawaii, Florida and California lead the states in solar water-heating
installations. However, the leading states have
less concentration of market share than in the
PV sector.
No new utility-scale solar thermal electric
plants were connected to the grid in 2008.
Developers have announced plans for installations totaling thousands of megawatts, promising to bring solar electricity to millions. But
given that the tax credits were scheduled to
expire at the end of 2008, some companies
delayed putting financing and permits in place.
The first of these new plants will probably come
on-line in 2010.
4. 9 kilowatts (k W), while the average nonresidential installation increased by 67 percent, to
114 k W. A total of 73 systems larger than 500
k W each accounted for 28 percent of the 2008
installed capacity.
One factor favoring larger installations is
that the installed price per watt is significantly
lower for larger systems. Based on data from the
California Solar Initiative database, installations
of systems larger than 500 k W cost 17 percent
less per watt on average than residential installations, most of which are smaller than 10 k W.
Virtually all large nonresidential installa-
tions, as well as many smaller ones, are financed
through power purchase agreements (PPAs).
With a PPA, a third party finances and owns
an installed solar system and receives available
incentives and tax benefits associated with that
system. That third party is then able to sell solar-generated electricity at a low rate to a building
or site owner through a long-term contract.
Outside of the self-generation market,
utility installations of PV grew by two-and-a-
half times during 2008, to 23 MW . These are
dc
installations on the utility side of the meter
that provide bulk power to the grid rather
than electricity for an on-site retail customer.
Utility installations will likely grow quickly
in 2009 and 2010, as the renewed federal
ITC allows utilities to receive such credits
for the first time. As a result, utilities have
proposed thousands of megawatts of instal-
lations, with large numbers likely to come
on-line in 2010.
Incentives continue to Drive
Solar Thermal Projects
In 2006, new federal tax credits, together
with rising conventional energy prices, caused
the solar water-heating market to explode.
Prior to 2006, about half of the solar water
heaters sold each year in the United States were
in Hawaii due to that state’s utility rebates,
Look for Policy to
Shape future growth
Long-term renewal of the federal ITC,
elimination of the residential cap and the more
recent creation of a federal grants program are
all likely to greatly impact the market. Policy
considerations at the state level could also support future market growth. These include —
• Not defining third-party owners of solar
equipment as utilities. Third-party ownership
has been the fastest growing market sector, and
allowing this ownership option is important to
market growth.
• Creation of community or virtual net
metering, which will increase the value of net
metering for some customers. (Community
net metering allows a group of entities with
multiple utility meters to consume and push
power back to the grid from the same distributed resource. Virtual metering lets a city or
town apply the energy credits produced by a
solar panel to any electricity account it holds,
not just the meter connected to the panel.)
• Implementing feed-in tariffs or other new
incentive models.
• Utility-rate designs that encourage customer use of solar energy.
Grid-connected PV installations have
experienced double-digit growth for more
than a decade. Last year was the fourth consecutive year of double-digit growth for solar
water heating. Installation growth will continue in 2009; what remains to be seen is, at
what pace? ST
