With the recent multi-year extension of the investment tax credit (ITC) in the United States, photovoltaic (PV) installations are predicted to grow 67 percent year over year, reaching 15 gigawatts (GW) in 2016. PV installations in the US will reach record levels in 2016, primarily due to strong demand for utility-scale PV. The Western and Southwestern US will account for the majority (65 percent) of total demand this year, according to IHS Inc. (NYSE: IHS), the leading global source of critical information and insight.”
“The extension of the tax credit relieves pressure on the industry to complete projects ahead of the 2016 deadline and breathes new life into the US solar industry” said Camron Barati, North America solar analyst for IHS Technology. “Many feared the solar industry in the United States, which has experienced tremendous growth over the last several years, might collapse in 2017 without an extension of the ITC.”
The United States currently has a 50 GW pipeline of commercial and utility-scale PV projects from 2016 to 2019, according to the IHS Solar Intelligence Service – North America. While all market segments are expected to benefit from the ITC extension, utility-scale PV will benefit most and account for over half of newly added capacity from 2016 to 2019. “Residential and commercial PV will experience sustained growth through the forecast period,” Barati said, “but mounting pressure from utilities to revise retail net metering rates and the falling cost of large-scale generation will limit growth opportunities in the US outside of well-established state markets.”
In 2017 the PV market in the United States will decline by 30 percent, due to lower demand for utility-scale PV, but will grow every year through the remainder of the forecast period. The Northeastern US will be the only region in the country that will not experience a decline in 2017, due to a lower reliance on utility-scale PV demand and a higher proportion of residential and commercial PV demand. IHS has identified three US states that are projected to install over 1 GW in 2016: California, Nevada and Texas.