U. S. may set record for solar energy in 2023
2023.01.28 04:20
U. S. may set record for solar energy in 2023
By Ray Johnson
Budrigannews.com – The United States is on track to install a record amount of solar power in 2023, just five months after President Joe Biden signed the most ambitious climate law in American history. However, the industry’s major growth spurt may not occur for at least another year.
The Inflation Reduction Act (IRA) calls for spending about $370 billion on clean energy to stop the climate crisis from getting worse. However, a combination of factors—supply snarls, trade tensions, power grid delays, and uncertainty about the new law’s upcoming rules—will likely limit solar panel installations this year.
According to Abigail Ross Hopper, chief executive officer of the Washington-based trade group Solar Energy Industries Association (SEIA), the industry will expand more than in 2022 “and likely more than 2021, but not to our full potential.” Despite the fact that that potential has been eliminated, I remain hopeful that the administration will assist in resolving some of the issues.
A domestic industry that has been tossed about by policy-driven booms and busts would have been cheered by a year with more solar installations than the previous record. However, as more utilities use panels to modernize their power grids, including in Middle America, solar is no longer an alternative.
The SEIA and energy consultant Wood Mackenzie anticipate an additional 27.9 gigawatts of US solar capacity this year. That is a significant increase from the estimated 18.6GW in 2022, but only a slight increase from the 24.1GW in 2021. In 2024, 2025, and 2026, gains are anticipated to be even greater.
A 2021 US law that seeks to punish China for alleged human rights abuses against the Uyghur ethnic minority in Xinjiang is one factor preventing a larger increase in installations this year. Polysilicon, an essential component in the production of solar panels, comes from the region, which accounts for approximately half of the world’s supply.
Customs officials have reportedly detained more than 1GW of imported modules on suspicion that they contain Xinjiang-related material. At least 80% of the panel supply for the United States comes from Asia.)
Additionally, solar developers face bureaucratic challenges, such as lengthy approval times for connecting projects to existing state or regional power grids. According to Pol Lezcano, “you can have great subsidies and the IRA supercharging the economics for solar.” “However, no matter how great these incentives are, it doesn’t matter if you can’t sell your product.”
California’s decision to drastically cut homeowner subsidies, which are credited with making residential solar systems popular there, dealt the industry yet another blow. In the largest solar-producing state, rooftop installations may be slowed by the April implementation of the changes.
Many people in the industry remain optimistic despite the challenges. By the following year, SEIA anticipates that “IRA-fueled growth will begin in earnest,” with annual solar growth of 21% between 2023 and 2027. According to Jaime Carlson, head of commercialization and market risk at California-based developer SB Energy, “we’re going to see impacts for decades to come.”
The groundwork for a boom is being laid. The IRA is already encouraging a flurry of investment in domestic cleantech manufacturing, which will eventually lessen the United States’ reliance on Asian imports.
Some conservative regions of the country are being persuaded to go solar by cheap modules. Additionally, battery storage is now a reality, potentially erasing the natural gas advantage over renewables: the capacity to supply power at all times.
Some developers are taking it slow for the time being while they wait for federal guidance on some IRA-related rules, such as a credit for domestic content. Kiran Bhatraju, CEO of Arcadia Power Inc., a Washington, DC-based company that manages a substantial portfolio of solar capacity produced by local farms, asserts, “I think it will be a bonanza” after they are released.
According to ConnectGen LLC, which is based in Houston, Nevada, obtaining all of the necessary permits for its Smoky Valley development on federal land will take years. However, it claims that because it is aware that the project will be eligible for IRA tax credits, it is comfortable investing money in it.
This year, the 65-person company intends to hire 20 more employees. The CEO, Caton Fenz, asserts, “The IRA represents the single greatest climate legislation that our country has ever passed.” That will always be a significant macro tailwind in our favor.
