The predictions for the U.S. solar market keep coming in. The late 2015 extension of the Investment Tax Credit (ITC) for multiple years impacted many analysts’ expectations for 2016 and beyond. Now IHS anticipates that the U.S. will install 15 gigawatts of solar power in 2016, 67 percent increase of 2014.
The analyst firm observed that the U.S. has a 50 gigawatt solar power project pipeline between 2016 and 2019. IHS added that all market segments are expected to benefit from the ITC extension but that utility-scale solar power will benefit most, accounting for over half of the new capacity being installed.
“Residential and commercial PV will experience sustained growth through the forecast period,” said Camron Barati, North America solar analyst for IHS Technology. “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.”
“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 U.S. solar industry,” Barati said. “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.”
IHS’s projections, at 15 gigawatts, are higher than most others’ were. For instance, Mercom revised its projections from 12 gigawatts of solar power in the U.S. in 2016, prior to the ITC extension, to 9 gigawatts of solar power after the ITC extension was announced.
The company anticipated that the West and Southwest U.S. will install 65 percent of the solar power in the country in the U.S. The majority of the new solar that will be installed in the U.S. this year will be utility-scale. In 2016 it projects that California, Nevada and Texas will each install more than 1 gigawatt of solar power in 2016.
Beyond 2016 IHS anticipated that the PV market will decline by 30 percent in the U.S. in 2017. IHS said that there will be lower demand for utility-scale solar power in 2017. After that the company anticipates that demand will grow each year.