Sizzling Hot Solar
Despite pandemic-induced disruptions early in the year and regulatory uncertainties, the solar industry hit record levels in 2020, with projections for continued explosive growth in 2021 and beyond.
According to COGNITION Smart Data, the solar market soared in 2020.
The International Energy Agency reports that renewable energy comprised 90% of new power capacity worldwide in 2020, and the Solar Energy Industries Association affirms that U.S. solar installations were up by 43%.
Some solar companies, such as JinkoSolar (NYSE: JKS), SolarEdge Technologies (NASDAQ: SEDG), Sunrun (NASDAQ: RUN), and Enphase (NASDAQ: ENPH), experienced triple-digit stock price gains in 2020 as the energy sector continued to transition to renewables, in contrast to many fossil fuel companies who reported disappointing shareholder returns due to decreased demand and plummeting oil and gas prices.
Reflecting on the U.S. market in 2020, JinkoSolar General Manager Nigel Cockroft said, “Despite everyone working from home and all the associated challenges around us, we achieved our volume goal, which was about 50% bigger than 2019’s volume. This meant about sixty 53’ trucks on the road delivering EAGLE Modules each and every business day of the year. The U.S. solar market continues to buoy our enthusiasm, and I am confident the industry will continue growing.”
Basic economics are driving the solar sector’s growth: Power sourced from wind and solar is now less expensive than power produced by fossil fuels on a national scale, and according to asset management firm Lazard, it is now less expensive to build new onshore wind and utility-scale solar power generation facilities than it is to operate existing fossil fuel facilities due to the decrease in the cost of wind and solar system components, improvements in efficiency, and lower marginal operating costs.
To propel its meteoric growth, the recent $1.4 trillion omnibus package passed by Congress included a two-year extension of the solar tax credits (which were scheduled to expire at the end of 2020). The Investment Tax Credit (ITC) for residential solar projects will remain at 26% for 2021 and 2022, dropping to 22% in 2023.
The solar sector’s impressive trajectory is projected to continue: IBISWorld estimates that the total revenue generated in the United States will reach $19.4 billion in 2026, more than double the $8.23 billion generated in 2020.
In addition to sustained growth, look for continued innovation in areas like high-efficiency bifacial modules, weather-resistant tempered solar glass, and battery storage solutions.
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COGNITION Smart Data offers advanced intelligence and insights about market trends and important customer information like behavioral patterns, purchase drivers, buying preferences and sentiment. COGNITION enables clients to make informed business decisions, yielding specific deliverables and tangible results. COGNITION provides a definitive competitive advantage by allowing companies to stay a step ahead of their competitors.
Sara Gutterman is the CEO of Green Builder Media. Follow her on Twitter and Facebook. For more information about green building and sustainable living, visit Green Builder Media at www.greenbuildermedia.com, like us on Facebook, and follow us on Twitter for regular updates and breaking news.