US solar installations booming, could overtake onshore wind longer term

US solar power capacity additions accounted for 43% of all incremental power generation capacity through Q3 2020 and appear set to record 19 GW of new solar capacity installations in 2020, a new record, according to a solar trade group report released Dec 15.

US solar companies installed 3.8 GW of incremental solar PV capacity in Q3 2020, a 9% increase from Q2 installations as the industry recovered from the worst impacts of the coronavirus pandemic, according to a statement from the Solar Energy Industries Association.

The US Solar Market Insight Q4 2020 report was prepared by SEIA in conjunction with consultant Wood Mackenzie.

The utility-scale market was the primary driver of Q3 installations with 2.7 GW of incremental capacity, representing 70% of all solar capacity brought online in Q3, according to the statement.

"Utility solar has been only minimally impacted by Covid-19 related construction delays," the report said.

Residential installations were up 14% from Q2 to Q3 2020 after pandemic-related lockdown orders during the spring caused the largest quarterly decline in history in the second quarter, the report said.

By contrast, the US wind power industry added about 6.4 GW of incremental capacity in the first nine months of 2020, which was a record, according to trade group American Wind Energy Association.

Planned generation

And while solar power dominates the interconnection queues, or new power generation waiting lists, at two of the Eastern US Independent System Operators in the short term, over the longer term, offshore wind power capacity additions appear set to exceed solar capacity growth.

For example, there are 1.7 GW of solar projects in the New York Independent System Operator's interconnection queue with commercial operational dates in 2021 compared with 1.6 GW of onshore wind power capacity, according to the grid operator.

However, an evaluation of all years of interconnection queue data showed 11.7 GW of solar generation capacity lined up compared to nearly 13 GW of offshore wind capacity and almost 5 GW of incremental onshore wind capacity.

Importantly, not all resources that submit interconnection queue requests are ultimately built, but the data paints a picture of the types of generation resources developers are looking to add to regional grids.

The story is similar in ISO New England territory where solar capacity dominates new generation capacity additions for 2021 with about 1.3 GW compared with around 19 MW of onshore wind power capacity.

Further out, however, considering all years of ISO-NE generation queue data, offshore wind dominates with almost 15 GW of capacity compared to just under 3 GW of solar capacity and 466 MW of solar plus batteries. There is also a comparatively small volume of onshore wind capacity of 225.6 MW, according to ISO-NE data.

In the Northeast, the trend toward lower volumes of onshore wind appears to be related to siting challenges.

"It's not getting any easier to site onshore wind projects in the Northeast," Rob Collier, vice president of developer relations at power purchase agreement marketplace LevelTen Energy, said in a phone call.

"New-build wind is a challenge throughout the Northeast, while solar is generally more accepted because the projects have smaller profiles and can be built in a more modular fashion," Collier said.

Solar power project installations from 2021 to 2025 are forecasted to exceed 107 GW, a 10 GW increase from last quarter, mainly driven by increases to the utility-scale solar pipeline, according to the SEIA report.