A day doesn’t pass without some type of solar-based press release, story, or research report hitting my inbox. Project announcements are abundant — everything from small-scale residential installations to massive utility-scale projects. Pardon the pun, but this market is hot and doesn’t show any sign of slowing down. So my question is this: Are you taking advantage of this growth segment, or, at the very least, are you preparing your company and employees for future opportunities in this sector?
Sure, there are concerns about how a lack of incentives/rebates and changing net metering policies will affect the industry’s future (as we reported in our August 2014 issue). There’s also concern about what effect lower oil and gas prices will have on the demand for future systems. But favorable reports from prominent research companies and technical advancements on the hardware front still support a forecast of solid growth.
According to the latest “U.S. Solar Market Insight Report,” developed by GTM Research and the Solar Energy Industries Association (SEIA), the United States installed 1,354MW of solar photovoltaics in the third quarter of 2014; 825MW of this total came from utility-scale projects. This marked the sixth straight quarter in which utility-scale PV accounted for more than 50% of the national total.
In its latest Annual Global Power and Energy Outlook, Frost & Sullivan remains confident that renewable investment will stay strong and that solar PV is currently judged to be the hottest of the renewable technologies. They forecast global solar PV capacity to rise from 93GW in 2012 to 446GW in 2020, with China, India, and North America recording the highest growth rates. They go on to note that incentives are becoming less important for a number of renewable markets, and commercial solar PV in North America is increasingly becoming competitive against centralized generation.
Wood Mackenzie is also bullish on the solar market. Its latest outlook poses the question, “Is solar the next shale?” They note, “Just as shale extraction technologies took oil and gas markets by storm, solar technologies also hold the potential to turn gas and power markets on their heads.” They go on to point out that in the last few years module costs have dropped from nearly 40% of the installed price to a little less than 20%. By 2020, they expect solar energy in 19 states to reach grid parity, with twice as many states reaching grid parity by 2030. “Wood Mackenzie has identified many evolutionary parallels to shale and believes that solar has the potential to make a similar scale of transformation across markets,” notes the outlook.
One of the most interesting technical developments I see right now is in the area of smart inverters. A basic inverter converts the direct current produced by the solar panel to alternating current that is synchronized with the utility power distribution system. Smart inverters can also dynamically regulate voltage, either by absorbing reactive power or injecting reactive power into the system. In other words, these smart devices can help utilities stabilize and manage power flow on the utility power system. Germany mandated smart-inverter requirements on its system about three years ago. California’s standard will become mandatory in mid-2016. And those in charge of IEEE Standard 1547, “Distributed Sources Interconnection with the Grid,” are looking at incorporating similar requirements, which would help drive adoption across other areas of the country.
The engineering firms and contracting companies that established their presence in this market a few years back are now reaping the rewards of jumping into this renewable market early. But this doesn’t mean it’s too late to join the party. What are you waiting for?
