2012: A Record-Breaking Year for America’s Solar Industry
As most industries across the country slowly climb out of the recession, solar remains one of the fastest growing sectors of the economy. How fast? According to an in-depth report by the US Solar Energy Industries Association and GTM Research, the number of solar installations increased 76% from 2011 to 2012.
Let’s break this number down.
The report reveals that in 2012, the U.S. 3.3 GW of total solar capacity. In just one year, the country nearly doubled its photovoltaic (PV) load, which now stands at 7.2 GW (or the equivalent of 7 nuclear reactors). And these installations weren’t just for major utility-scale projects. In 2012, roughly 83,000 homeowners decided to go solar—a remarkable feat.
What does 3.3 GW mean in strictly monetary terms? It means going from $8.6 billion to $11.5 billion, making solar 34% more profitable in 2012.
These impressive numbers don’t even factor in the downstream benefits of solar’s meteoric rise. Just imagine all of the tangential training, employment, and investment opportunities indirectly tied to solar energy.
The sun is both literally and figuratively fueling our nation’s economy. And by the end of this year, total installed solar capacity is expected to reach 10 GW.
The Reason Behind America’s Solar Boom
There exist any number of ways to explain this fantastic growth:
- With super-storms and global warming, more Americans are becoming serious about the environment
- Better outreach and marketing are helping to make solar a household concept
But the most convincing explanation behind the current solar boom comes down to economics. Fuel prices are on the rise while solar prices are in decline. From 2011 to 2012, for example, the average per-watt cost of a new installation fell from $4.10 to $3.01—a decrease of nearly 27%.
Faced with the decision to pay increasingly high electricity bills versus harnessing free energy from the sun—the choice is easy.
What’s truly remarkable is that despite this phenomenal drop in prices, the US solar market’s net worth still grew by more than 33%.
Some Surprising Findings of the 2012 Solar Report
When you think of solar potential, Maryland is not a state that immediately comes to mind. But according to the report, it was last year’s 8th most active solar market, beating out Texas, New Mexico, and even the Sunshine State (Florida).
Two factors help to explain why this Mid-Atlantic state is quickly emerging as one of the top solar spots in the country.
- Maryland offers some of the most generous solar PV incentives in the U.S.
- Maryland enjoyed the largest PV price decline of any state in the nation (-33%), making solar an attractive option for approximately 11,000 homeowners
While solar may not be an ideal investment for every home or every climate, it's rise in 2012 is historic for the U.S. solar energy industry.
Ryan McNeill is the president of Renewable Energy Corporation, a Maryland solar solutions firm. Ryan frequently contributes to renewable energy publications across the Web as well as Renewable Energy Corporation's solar blog.
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