US module shipments down in January and February

The latest edition of the Monthly Solar Photovoltaic Module Shipments Report issued by the U.S. Department of Energy’s Energy Information Administration (EIA) indicated 1.36 GW of solar modules were imported and exported in February, down from 1.49 GW a month earlier and 1.96 GW in December.

The 1.36 GW of modules shipped in February, however, represented a 308% increase on the 442 MW moved a year earlier and may be partially explained by project developers stockpiling in anticipation of possible Covid-19 supply shocks.

Despite falling volumes this year, the numbers remain consistent with the rising trend which began in the second half of last year as companies looked to safe-harbor project components ahead of a planned fall in the Investment Tax Credit (ITC) for solar this year, from 30% to 26%. The ITC sets the proportion of the cost of a solar installation which can be deducted from federal taxes. The 30% level applied to all projects which began last year and solar developers were able to lock in the full credit by paying at least 5% of the cost of facilities to enjoy a safe harbor provision. With modules supplying more than 5% of project costs, having them shipped was a safe way to secure the full ITC.

The ITC is currently due to fall to 22% next year.

Shipments down but strong

Since June, no month has seen less than 1 GW shipped – a streak that is almost double the length of the previous record, from August to November 2017. It is unclear how much of the shipment volume concerns imports as the EIA has withheld that data since December 2018.

California, predictably, was home to the most shipments in February – 420 MW. It was followed by Texas, with 141 MW; Tennessee – a surprise entry – with 85 MW; New Jersey, with 55 MW; and Florida, with 44 MW. Tennessee had 58 MW shipped in January, a notable amount, with its two-month shipment capacity representing more than a third of the state’s installed capacity. Those figures could have something to do with the 484 MW of new solar generation capacity public body the Tennessee Valley Authority has contracted since December.

More stockpiling?

While month-by-month shipments were down, the average price-per-watt of solar modules rose drastically in February, up to $0.46 from $0.40 in January. The former figure is the highest monthly price since June 2018 and represents the largest monthly jump seen since that point.

What the data does not yet show is the extent to which the Covid-19 pandemic has affected module shipments. Installers have told pv magazine they have been stockpiling modules and other equipment in preparation for potential supply chain disruption. That could at least partially explain the February price spike.