According to the U.S. Solar Market InsightTM: Year-In-Review 2010 [pdf], the industry’s total value grew 67% from US$3.6 billion to US$6.0 billion last year. This growth made solar the fastest growing sector of the energy industry, and a pace-setter for the country’s economy — whose GDP grew less than 3%.
The research points to four major catalysts for the industry’s 2010 growth: renewal of the tax incentives offered in the 1603 Treasury program, completion of significant utility-scale projects, expansion into new markets, and reduction in cost.
Last year 16 states installed more than 10-megawatts of solar power; this was up from four in 2009. Once again, California and New Jersey were the installation leaders. Additionally, installation costs dropped markedly last year. Commercial photovoltaic installations dropped 11% in cost, while residential installations dropped 8%.
All this to say, the U.S. solar industry had a major breakthrough last year. Beyond the obvious help to the country’s struggling economy, this growth is an important signal to China as the United States’ battles for market share in the new energy economy. China has quickly become the world’s leading financier of clean energy; and even more, it is the global manufacturing hub for the solar industry.
The pressure has been mounting for the U.S. to take stronger action in developing a low-carbon economy in order to mitigate the risk of conceding its role as the world’s largest economy. The growth of its solar industry is a step in the right direction. As Shayle Kann, Managing Director of Solar at GTM Research, states, “The U.S. PV market saw a breakthrough in 2010 and is emerging as a global demand center for both suppliers and project developers.