US renewable energy is set to see over 32 GW of solar installations in 2024, as per new data from the American Clean Power Association and S&P Global Commodity Insights.
Future Growth Expectations
The initial edition of the biannual Solar Market Monitor report indicates a projected 6.6 percent compound annual growth rate (CAGR) from 2025 through the end of the decade, with 37 GW of solar projects expected to come online. However, a minor setback is anticipated in 2025, where installations will likely drop by 16 percent when compared to 2024. This surge in 2024 is largely attributed to the urgency to meet the deadline for a tariff moratorium on solar panel imports from several Southeast Asian countries. The Biden administration initiated a 2-year tax break in 2022, enabling solar developers to obtain less expensive PV panels from nations like Cambodia, Malaysia, Thailand, and Vietnam. A key condition of this moratorium is that all solar projects must be finished before 2025.
Recovery on the Horizon
Despite the expected dip, the US solar sector is predicted to recover in 2026, with consistent growth anticipated until 2030. This rebound will be partially driven by decreasing prices of PV modules, potentially leading to a 16 percent reduction in project costs. Consequently, the levelized cost of energy (LCOE) is projected to fall from $46/MWh to $38/MWh by 2030.
There are worries about the incoming Donald Trump administration possibly undermining sections of Biden's Inflation Reduction Act (IRA). Nevertheless, many experts in the industry remain hopeful that the vital elements of the act will be maintained.
Industry Insights
In response to the report, John Hensley, senior vice president of policy & market analysis at the American Clean Power Association, remarked, "This first report emphasizes how solar has established itself as a clean and economically viable energy resource in the US. As we move forward, this resource will assist the industry in navigating through the evolving US solar market."
