US solar outshines wind and gas with record 14.6GW in 2016
New US solar additions blew past wind and natural gas last year, making 2016 the first year in history in which solar was the country’s largest source of new electric-generation capacity.
The US added 14.6GW of new solar capacity last year, a stunning 95% increase on the 7.5GW the country put up in 2015, itself a record, according to new figures from GTM Research and the Solar Energy Industries Association.
For comparison, the US added 8.2GW of new wind capacity in 2016, according to figures released last week by the American Wind Energy Association.
Solar accounted for 39% of all new generation capacity added in the US last year, compared to 29% for second-place natural gas and 26% for wind.
Solar’s historic performance was driven in large part by the booming utility-scale market, as developers brought on-line projects whose construction schedules were timed to reach completion before the end of 2016, when the 30% solar investment tax credit was originally scheduled to expire.
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In late 2015 the ITC – like the wind production tax credit – received a multi-year extension, but many big solar projects were already in train by then.
“While US solar grew across all segments, what stands out is the double-digit gigawatt boom in utility-scale solar, primarily due to solar’s cost-competitiveness with natural gas alternatives,” says Cory Honeyman, GTM Research’s associate director of US solar research.
More than 22 US states added at least 100MW of new solar capacity last year, adding to the market’s growing geographic diversity. Wind projects were built in 19 states last year.
Nearly all major US wind owners are now investing in solar in one form or another, from utilities like NextEra Energy and Southern Company to independent power producers like EDP Renewables and Enel Green Power.
Wind and solar are expected to closely complement and compete with each other in the coming years, with solar seen as a growing threat by some in the wind business.
Industry experts say proposed changes to the US tax system would hurt wind investment more than solar, and unlike the PTC, which drops to nothing for wind projects that enter construction in 2020, the solar ITC is scheduled to phase down from 30% and then remain at 10% indefinitely.
Some of the major transmission projects planned in the US to flow wind power from the country’s interior to population centres closer to its coasts could be jeopardised by the proliferation of solar arrays built closer to load centres, some experts say.