According to the latest report from the International Energy Agency’s (IEA) Photovoltaic Power Systems Program (PVPS), the United States will set solar records in 2023 as international trade concerns eased and financial security increased, thanks to the implementation of US Inflation Reduction Act. .
The IEA-PVPS has a report analysis of the development of the energy systems market in the United States in 2023, defined as all nationally installed terrestrial PV applications with a capacity of more than 40 W.
The report states that records were broken in the US solar industry last year as market disruptions caused by international trade issues decreased and policy and financial certainty increased in line with the implementation of the US Inflation Reduction Act (IRA).
A total of 26.3 GW of new solar capacity was deployed last year, including 18.4 GW of utility-scale projects and 7.9 GW of decentralized systems. By the end of 2023, there were more than 4.7 million decentralized PV systems connected across the country.
Community solar projects, which refer to local solar facilities shared by multiple players who receive electricity bill credits for their share of electricity produced, contributed 1.04 GW to the new deployment total. According to the report, this technology is rapidly growing in popularity in the US market.
Key demand drivers for PV development in the United States include energy storage, which exceeded 7.2 GW of annual installations by 2023, and electric vehicle demand, which increased by nearly 1.5 million vehicles last year. Additional factors include rising retail electricity costs, consumer demand for greater resiliency and the installation of solar energy in new home construction. The report states that record growth has occurred despite challenges such as long interconnection timelines, increasing curtailment, local opposition and rising prices.
The IRA has been called “the most significant change in direct solar support policy in US history,” according to the IEA-PVPS. The The federal law introduced extensive tax breaks and incentives for small-scale and large-scale solar energy installation and production. In 2023, several provisions of the IRA were clarified and implemented.
The report said that following the approval of the IRA, domestic deployment forecasts “increased significantly and there were announcements of manufacturing facilities across the supply chain.” As of May 2024, more than 300 GW (DC) of manufacturing capacity had been announced across the solar supply chain, the IEA-PVPS said, including polysilicon, wafer, cells, ingots, tracking, production tools, inverters and other module components across the world. new facilities or expansions.
“Many project owners and analysts have identified the expanded and new IRA tax credits as the driving force behind this growth,” the report said. It predicted that the IRA “will achieve even faster deployment in the coming years.”
According to the report, prices and system costs of PV modules have continued to decline, increasing the competitiveness of solar energy. The report cited an average price for residential PV systems of $2.49/W in 2023, while large centralized systems fell to just $1.16/W. The typical price for a standard crystalline silicon module was $0.39/W.
In 2023, module imports almost doubled compared to 2022 levels. IEA-PVPS reported that 162 installers and developers noted relaxed supply chain restrictions, with record growth driven in part by the implementation of delayed projects. Despite the increase in domestic production capacity, most PV modules used in the United States were still imported.
In its closing remarks, the report said that “international trade issues continue to loom as the emerging manufacturing market seeks to protect itself, and it remains to be seen which supply chain sectors and business models will succeed on U.S. shores.”
The report is part of IEA-PVPS Task 1, which focuses on the technical, economic and social aspects of PV energy systems.
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