Solar Industry Research Data
Solar Industry Growing at a Record Pace
Solar energy in the United States is booming. Along with our partners at Wood Mackenzie Power & Renewables and The Solar Foundation, SEIA tracks trends and trajectories in the solar industry that demonstrate the diverse and sustained growth of solar across the country.
Below you will find charts and information summarizing the state of solar in the U.S. If you're looking for more data, explore our resources page. In addition, SEIA Members have access to presentation slide decks that contain this data and much more. Not a SEIA Member? Join today!
Massive Growth Since 2000 Sets the Stage for the Solar+ Decade
In the last decade alone, solar has experienced an average annual growth rate of 33%. Thanks to strong federal policies like the solar Investment Tax Credit, rapidly declining costs, and increasing demand across the private and public sector for clean electricity, there are now more than 121 gigawatts (GW) of solar capacity installed nationwide, enough to power 23.3 million homes.
Solar as an Economic Engine
As of 2020, more than 230,000 Americans work in solar at more than 10,000 companies in every U.S. state. In 2021, the solar industry generated more than $33 billion of private investment in the American economy.
Growth in Solar is Led by Falling Prices
The cost to install solar has dropped by more than 60% over the last decade, leading the industry to expand into new markets and deploy thousands of systems nationwide. An average-sized residential system has dropped from a pre-incentive price of $40,000 in 2010 to roughly $20,000 today, while recent utility-scale prices range from $16/MWh - $35/MWh, competitive with all other forms of generation.
Supply Chain Constraints Lead to Price Increases
However, over the last 9 – 12 months, shipping constraints and other supply chain challenges stemming from the global pandemic and trade instability have led to price increases across the U.S. solar industry. For the first time since Wood Mackenzie began modeling solar system price data in 2014, year over year prices have increased across all market segments for three consecutive quarters, leaving utility-scale solar prices 18% higher than they were a year ago. Price increases have impacted deployment, with a third of Q4 2021 projects delayed a quarter or more, and 13% of expected 2022 projects delayed by a year or more or canceled outright.
Solar's Share of New Capacity has Grown Rapidly
Solar has ranked first or second in new electric capacity additions in each of the last 9 years. In 2021, 46% of all new electric capacity added to the grid came from solar, the largest such share in history and the third year in a row that solar added the most generating capacity to the grid. Solar’s increasing competitiveness against other technologies has allowed it to quickly increase its share of total U.S. electrical generation - from just 0.1% in 2010 to nearly 4% today.
The U.S Solar Industry is a 50-State Market
While California has traditionally dominated the U.S. solar market, other markets are continuing to expand rapidly. In 2021, states outside of California made up their largest share of the market in the last decade, led by rapid growth in Florida and Texas. As demand for solar continues to grow, new state entrants will grab an increasing share of the national market.
Prices Decline for Rooftop Solar, but Higher Soft Costs Remain
The biggest cost-decline opportunity in residential and small commercial solar exists in soft costs, which includes installation labor, customer acquisition, and permitting/inspection/interconnection. While the soft cost share of total system costs has stabilized in recent months due to increased customer demand, rising hardware costs and pandemic-related improvements to permitting practices, U.S. solar soft costs continue to be much higher than those of other developed solar markets around the world. Through programs like Solar Automated Permit Processing (SolarAPP) and SolSmart, SEIA and our partners are working to reduce local barriers to going solar.
Storage is Increasingly Paired with All Forms of Solar
Homeowners and businesses are increasingly demanding solar systems that are paired with battery storage. While this pairing is still relatively new, the growth over the next five years is expected to be significant. By 2025, over 29% of all new behind-the-meter solar systems will be paired with storage, compared to under 11% in 2021. The utility-scale market is also recognizing the benefits of pairing solar with storage, with over 45 GW of commissioned or announced projects paired with storage, representing over 50 GWh of storage capacity.
Residential Market Continues to Diversify
The residential solar market experienced its 5th consecutive record year in 2021, growing 30% over 2020 with 4.2 GW installed. Customers continue to be motivated by increasing household electricity bills brought on by the pandemic, power outages and low financing costs. That growth is threatened however, by proposed changes to Net Metering rules in multiple states. In California’s NEM 3.0 case, the proposed decision issued by the Public Utilities Commission could cut the California market in half by 2024. Details on future NEM 3.0 proposals are forthcoming.
Corporate Clean Energy Goals Boost Commercial Solar
The commercial solar market, which consists of on-site solar installations for businesses, non-profits and governments, has grown unevenly in recent years as the industry continues to unlock the financing tools needed to provide access to a wide swath of business types. However, sustained adoption by large companies with clean energy goals like Walmart, Apple, Target and Amazon will help push the segment to near-record levels in 2022. With a little more than 1% of commercial electricity demand served by on-site solar, there remains significant opportunity for growth in this segment.
New State Entrants Help Fuel Community Solar Growth
While early growth for community solar installations was led primarily by three key markets - New York, Minnesota, and Massachusetts - a growing list of states with community solar programs have helped diversify the market, creating large pipelines set to come to fruition over the next several years. Continued growth in state community solar programs and improvements to state and regional interconnection processes are imperative to ensure solar access for all types of homeowners and businesses.
Large Utility-Scale Solar Pipeline Outpaces Installs
The utility scale solar market faced a host of challenges in 2021 as the pandemic wreaked havoc on international supply chains and labor availability, pushing prices to their highest levels in three years. Multiple circumvention petitions seeking to prohibit module imports from certain countries have further exacerbated supply chain challenges and if adopted could have devastating impacts on the industry. The combination of headwinds has resulted in delays and cancelations for many projects, resulting in a 19% reduction in utility-scale deployment forecasts in 2021/2022 over the last six months. Despite this, demand for utility-scale solar remains strong as increasing numbers of states, utilities and corporations seek to fulfill their clean energy goals.
Solar PV Growth Forecast
The U.S. Solar market installed a record 23.6 GW in 2021, despite supply chain challenges brought on by the pandemic and trade disputes. Pricing and procurement challenges will continue to impact deployment in 2022, leading to the first annual decline in the market in 4 years. Assuming supply chain recovery and no major trade barriers, growth should resume in 2023 ahead of Investment Tax Credit step down in 2024. Barring new policy developments at the state and federal levels, industry growth through the end of the decade is premised on continued price declines and growing demand from utilities, states, corporations, and distributed solar customers.
More Aggressive Growth Needed to Reach Climate Goals
While projected growth over the next 10 years puts the solar market in reach of ambitious clean energy goals set by the industry and the Biden administration, more work is needed to achieve the pace required for a 100% clean energy electricity system. Annual installs will need to grow from less than 20 GW in 2020 to more than 90 GW by 2030, with cumulative totals nearing 700 GW by the end of the decade. A combination of private sector innovation and stable, long-term public policy will set the solar industry on a path to achieving these more aggressive goals to address climate change and decarbonize the economy.
Solar Helps Fortune 500 Companies Save Money
Data from SEIA's annual Solar Means Business report show that major U.S. corporations, including Apple, Amazon, Walmart, Target, and Google are investing in solar and renewable energy at an incredible rate. Through 2019, the top corporate solar users in America have installed more than 8,300 MW of capacity across more than 38,000 different facilities across the country.
Other key takeaways:
- Corporate solar adoption has expanded rapidly over the past several years, with two thirds of all capacity installed since 2015.
- The 1,286 MW installed in 2019 represents a 10% increase from 2018 and is second to only 2017 for annual commercial deployment.
- The surge in on-site commercial solar continued in 2019, with a record 844 MW installed, while 441 MW of off-site projects were completed.
- The systems tracked in this report generate enough electricity each year to power 1.6 million U.S. homes.
You can explore SEIA's Solar Means Business report, including interactive maps and data tools on the top corporate solar users in the U.S.