A decade of growth

Hosted by Solar Energy Industries Association (SEIA) and Solar Electric Power Association (SEPA), SPI is a major event on the U.S. solar industry calendar. Being the world’s largest energy producer and consumer, growth of the U.S. market can deliver significant demand for PV producers and installers. And 2013 has seen impressive figures emerge. Last month, Deutsche Bank released an investment note in which it predicted that cumulative PV capacity in the U.S. will reach 50 GW by the end of 2016. The note anticipated installations to surge before the Investment Tax Credit (ITC) is reduced in 2016. The annual market is predicted to reach 12 GW in 2015 and 16 GW in 2016.
Also driving the growth, according to the Deutsche Bank analysts, is the increasing spread of grid parity across U.S. states. With system costs falling below $3/W, the states of Hawaii and California are leading the charge to grid party, with 10 states in total having reached the milestone. In 2016, with the ITC of 30% still in place, Deutsche Bank sees 47 states having reached grid parity, however this figure is set to drop to 36, when the ITC falls to 10%.
However, not all observers of the U.S. market are quite as bullish. Paula Mints, the Founder and Chief Market Analyst of SPV Market Research, cautions that many of the large PV projects being installed today have been under development for many years and that demand of this nature cannot be counted on in the future. “Installations for multi-megawatt systems are occurring at a fast rate,” said Mints, “many people have overlooked the fact that these systems were announced years ago.” The market analyst also says that it is unlikely that all announced projects in the utility-scale sector will actually go ahead. This is because some announced projects have been subject to underbidding and, “the bids are just too low,” Mints says.
The residential market has also been slowing in the U.S. of late, according to Mints. She notes that solar leasing remains an unavoidable driver in the U.S. residential market, mainly in the way it has expanded consumer understanding of PV and perhaps increased consumer confidence. “Even if the potential system owner buys the lease out up front, it has made more homeowners at least consider solar,” said Mints. The ongoing debate regarding net metering in various U.S. states is also set to be a topic for discussion at this year’s SPI, according to Mints. She says that maintaining net metering where it exists is crucial for the market to continue to grow.
Some other U.S. market observers agree that very large PV installations may be a thing of the past in the country. “The average project size will decrease,” says Jenya Meydbray, the CEO of PV Evolution Labs. “Very large project PPAs will become increasingly difficult to obtain,” he concludes. However he adds that he expects the residential PV market, “to continue to expand at an increasing rate.”

Quality is key

An issue that has been getting increasing exposure in the U.S. market – although not in the U.S. alone – is that of PV component quality. A recent article in the New York Times, by industry journalist Todd Woody, made the theme very public. In the article Woody wrote: “at stake are billions of dollars that have financed solar installations, from desert powerplants to suburban rooftops, on the premise that solar panels will more than pay for themselves over a quarter century.” PV Evolution Labs’ Meydbray says that while he’s hesitant to draw broad conclusions about PV component quality, he encounters a 5 – 10% failure rate in his laboratories, among modules bound for the U.S. market. “From our perspective, the problem of low quality modules is not pervasive, however we do encounter defects occasionally and the buyers are generally very glad to have caught these defects before they impact on return on investment,” said Meydbray.
The trend in the U.S. market is also towards more rigorous and continuous testing of components, reports Meydbray, with requirements for comprehensive technical due diligence becoming more common. “Finance providers and project owners have started to require additional scrutiny that includes third-party testing,” said Meydbray. However he does warn, “there are some EPC firms and developers out there that focus only on installed price per watt.” Reflecting the growing cognizance of component quality, SPI has scheduled a series of presentations tackling various aspects of the quality challenge (see box below). On the SPI website, a search and planner tool can assist attendees to find workshops and presentations or the themes they are after and create a personalized schedule, using the Planner Tool.
SPI will also feature a Start-Up Alley for the first time this year. Thirty solar startups will introduce their wares and companies. In August SEIA and SEPA announced the first panel of judges for the Start-Up Alley Challenge, drawing on clean energy leaders and investors. The judging panel will also provide feedback to the fledgling businesses and assist with reviewing their business proposals.
Last year 21,000 visitors attended SPI in Orlando, Florida, down from highs in 2010 of 23,300 when 1,122 companies exhibited. SPI organizers say that unlike other conferences and trades shows, proceeds from the event support the expansion of the solar industry in the U.S. through supporting SEIA’s and SEPA’s research, education and advocacy efforts. SPV Market Research’s Paula Mints adds that SPI is also an excellent networking opportunity and an event that most people in the U.S. solar industry plan to attend, “even if for just for one day.” SPI will be held at McCormick Place, Chicago, Illinois, October 21 to 24.
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