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The State of the U.S. Solar Industry: 5 Questions Answered
By Joshua D. Rhodes
Editor's note: On Jan. 22, the Trump administration announced plans to impose punitive duties on solar panels imported from abroad. This decision came in response to a complaint filed by two solar companies, but much of the industry opposes the action, which trade groups say will increase the cost of solar projects and depress demand. To illustrate what's at stake, energy scholar Joshua Rhodes provides some context on the U.S. solar industry and its opportunities and challenges.
1. How big is the U.S. solar industry, and what is its growth trajectory?
The U.S. solar industry generated US$154 billion in economic activity in 2016, including direct sales, wages, salaries, benefits, taxes and fees. Its revenues have grown from $42 million in 2007 to $210 million in 2017.
About 25 percent of total new power plant capacity installed in 2017 came from solar. Total installed U.S. solar capacity is more than 50 gigawatts—the equivalent generating capacity of 50 commercial nuclear reactors.
Solar is projected to continue to grow for the foreseeable future. However, recent events such as the solar trade tariff and tax code changes could dampen that trend. According to one estimate, the tariff alone will reduce solar installations by 11 percent from 2018 through 2022.
The industry directly or indirectly employs about 370,000 people in the U.S., of which 260,000 are full- or part-time. Solar photovoltaic installers make up about half of this workforce. In fact, solar PV installer is currently the fastest-growing job in the nation, with a median annual salary of nearly $40,000.
For comparison, the coal industry only supports about 160,000 jobs. Electric power generation from solar and wind energy combined contributes about three times as many jobs as electricity production from fossil fuels.
2. Why are most of the solar panels that are installed in the U.S. manufactured overseas? Is this pattern likely to change?
About 80 percent of solar panels installed in the U.S. last year were built overseas. While the industry was invented here, China has poured up to $47 billion into tax breaks and incentives in order to develop what it views as a strategic capability. Along with an abundant supply of cheap skilled labor, these investments reduced the price of solar panels by 80 percent between 2008 and 2013.
Some foreign solar panel manufacturers are negotiating to open factories in the U.S., much as foreign car manufacturers did during the Reagan administration. However, any new manufacturing is likely to be highly automated, so it might not generate major numbers of new jobs.
3. Which sectors and states produce the most solar power today?
About 60 percent of total U.S. solar generating capacity is in a relatively small number of very big projects owned by power companies. The rest is what's known as distributed capacity, meaning small-scale projects that generate energy at many sites. It includes rooftop solar power on homes, community solar projects and commercial installations, such as solar panels on the roofs of big-box stores like Walmart.
California has nearly half of all U.S. solar electricity generating capacity, followed by Arizona, New Jersey and North Carolina. Alaska, North Dakota and South Dakota are the only states with less than one megawatt of small-scale solar photovoltaic capacity.
4. How affordable is solar power for customers who aren't affluent?
Affordability can be a barrier to going solar, but there are ways to reduce it. For example, some utility customers can subscribe to community solar programs—projects that serve multiple customers in a single area—and even reduce their rates by doing so. Community solar projects do not usually require customers to own their homes, so renters can take part.
There are also peer-to-peer networks that allow homeowners with solar to donate their excess energy to those in need. Instead of receiving credit from their utility for generating more electricity than they use in a given month, these households authorize the utility to apply that credit to a needy household's bill.
It is also important to note that utility-scale solar power can lower the cost of electricity for all of that utility's customers. In Texas, where I live, adding wind and, soon, solar generation has kept wholesale electricity prices low as the price of renewable electricity has fallen. Keeping these prices low makes it harder for power companies to justify raising electricity rates, which directly helps lower-income customers.
5. What are the biggest challenges that U.S. solar companies face today?
There are signs that the residential solar market is slowing down. Some companies are shifting their focus from deploying as much capacity as possible to trying to maximize revenue by scaling back expansion, so that they can focus on a few states that offer the best returns on investment.
In some major markets, such as California, bringing large amounts of solar generation online is depressing wholesale electricity market prices, which erodes the value of the electricity that these systems produce. This makes projects gradually less economic to install.
The Trump administration's solar tariff will be more challenging for utility-scale solar projects than for residential, because the modules account for a larger share of the total cost of large projects. A 30-percent tariff will likely increase the costs of solar installations by about 11 cents per watt, or roughly 10 percent, which could reduce the amount of solar installed over the next 4 years by five to eight gigawatts of capacity, mostly at the utility scale.
In my view, the biggest challenge for U.S. solar companies—particularly installers—is uncertainty. Congress recently tried unsuccessfully to cancel tax credits for installing new solar capacity, and the tax cut bill that was enacted in December includes some changes that may affect credits for investing in solar. Companies need certainty to create value and jobs—and for solar and other renewable energy sources, certainty is in short supply at the moment.
Reposted with permission from our media associate The Conversation.
EcoWatch Daily Newsletter
By Jennifer Molidor, PhD
Climate change, habitat loss and pollution are overwhelming our planet. Thankfully, these enormous threats are being met by a bold new wave of environmental activism.
Trump Makes Strange Claim About Water Efficient Toilets: 'People Are Flushing Toilets 10 Times, 15 Times'
President Donald Trump mocked water-efficiency standards in new constructions last week. Trump said, "People are flushing toilets 10 times, 15 times, as opposed to once. They end up using more water. So, EPA is looking at that very strongly, at my suggestion." Trump asked the Environmental Protection Agency (EPA) for a federal review of those standards since, he claimed with no evidence, that they are making bathrooms unusable and wasting water, as NBC News reported.
By Carey Gillam
Former Monsanto Chairman and CEO Hugh Grant will have to testify in person at a St. Louis-area trial set for January in litigation brought by a cancer-stricken woman who claims her disease was caused by exposure to the company's Roundup herbicide and that Monsanto covered up the risks instead of warning consumers.
A powerful volcano on Monday rocked an uninhabited island frequented by tourists about 30 miles off New Zealand's coast. Authorities have confirmed that five people died. They expect that number to rise as some are missing and police officials issued a statement that flights around the islands revealed "no signs of life had been seen at any point,", as The Guardian reported.
"Based on the information we have, we do not believe there are any survivors on the island," the police said in their official statement. "Police is working urgently to confirm the exact number of those who have died, further to the five confirmed deceased already."
The eruption happened on New Zealand's Whakaari/White Island, an islet jutting out of the Bay of Plenty, off the country's North Island. The island is privately owned and is typically visited for day-trips by thousands of tourists every year, according to The New York Times.
My god, White Island volcano in New Zealand erupted today for first time since 2001. My family and I had gotten off it 20 minutes before, were waiting at our boat about to leave when we saw it. Boat ride home tending to people our boat rescued was indescribable. #whiteisland pic.twitter.com/QJwWi12Tvt— Michael Schade (@sch) December 9, 2019
Michael Schade / Twitter
At the time of the eruption on Monday, about 50 passengers from the Ovation of Seas were on the island, including more than 30 who were part of a Royal Caribbean cruise trip, according to CNN. Twenty-three people, including the five dead, were evacuated from the island.
The eruption occurred at 2:11 pm local time on Monday, as footage from a crater camera owned and operated by GeoNet, New Zealand's geological hazards agency, shows. The camera also shows dozens of people walking near the rim as white smoke billows just before the eruption, according to Reuters.
Police were unable to reach the island because searing white ash posed imminent danger to rescue workers, said John Tims, New Zealand's deputy police commissioner, as he stood next to Prime Minister Jacinda Ardern in a press conference, as The New York Times reported. Tims said rescue workers would assess the safety of approaching the island on Tuesday morning. "We know the urgency to go back to the island," he told reporters.
"The physical environment is unsafe for us to return to the island," Tims added, as CNN reported. "It's important that we consider the health and safety of rescuers, so we're taking advice from experts going forward."
Authorities have had no communication with anyone on the island. They are frantically working to identify how many people remain and who they are, according to CNN.
Geologists said the eruption is not unexpected and some questioned why the island is open to tourism.
"The volcano has been restless for a few weeks, resulting in the raising of the alert level, so that this eruption is not really a surprise," said Bill McGuire, emeritus professor of geophysical and climate hazards at University College London, as The Guardian reported.
"White Island has been a disaster waiting to happen for many years," said Raymond Cas, emeritus professor at Monash University's school of earth, atmosphere and environment, as The Guardian reported. "Having visited it twice, I have always felt that it was too dangerous to allow the daily tour groups that visit the uninhabited island volcano by boat and helicopter."
The prime minister arrived Monday night in Whakatane, the town closest to the eruption, where day boats visiting the island are docked. Whakatane has a large Maori population.
Ardern met with local council leaders on Monday. She is scheduled to meet with search and rescue teams and will speak to the media at 7 a.m. local time (1 p.m. EST), after drones survey the island, as CNN reported.
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