It seems that nearly weekly we hear more good news on the solar energy front. Today, the Solar Energy Industries Association and GTM Research released their Solar Market Insight Report for Q3 2012, with a summary of accomplishments year to date. The progress is impressive and would have been unimaginable just five years ago. Furthermore, the growth is expected to continue for the next several years, jumping from 3.2 GW in 2012 to 7.8 GW by 2015. Some highlights from the report:
- By the end of 2012, an estimated 3.2 gigawatts (GW – or 3,200 megawatts) of solar power will have been installed – an increase of 70% over last year.
- The multi-year pipeline for solar-scale programs is finally reaching fruition, with some very large projects coming on line.
- California, New Jersey, and Arizona are leading the charge.
- Solar costs have fallen by over 30% in the past two years.
One of the macro factors driving this expansion is the vast overcapacity currently affecting markets. It is estimated that panel manufacturing capacity currently outpaces demand by a factor of over two to one (70 GW to 31 GW). This lack of equilibrium cannot last forever and should result in more plant closures – especially since global demand is growing at 14%. It will be interesting to see what happens to prices once supply-demand equilibrium gets back in balance.