Renewable energy still accounts for only a small portion of US electricity generation, but the solar industry reports that 2023 could be the year of a major breakthrough.
A report from the Solar Energy Industries Association (SEIA) and Wood Mackenzie estimates that the US solar industry will add 32 gigawatts (GW) of capacity in 2023, up 52% from 2022.
As of February 2023, total electric generating capacity in the United States will be nearly 1.3 million megawatts.
The pandemic brought the industry to a standstill in 2020 as supply chain issues and restrictive trade policies slowed production. However, the report cited supply chain improvements and Inflation Reduction Act (IRA) incentives as key drivers of increased energy production. The report estimates solar power generation will grow from the current 153 GW to 375 GW in five years.
“The United States is now the dominant player in the global green energy economy, and states like Florida, Texas, Ohio and Georgia are at the forefront when it comes to job growth and economic prosperity,” said Abigail Ross Hopper, President and CEO of SEIA . “The solar power and storage industry provides vast amounts of clean energy, generating tens of billions of dollars in private investment, and that is just the tip of the iceberg.”
According to SEIA, increased new investment in US manufacturing is also expected to improve supply conditions in the coming years. In fact, industry groups believe that solar panel production in the US may be 10 times greater than it is today by 2026.
In addition to companies building large solar power plants, individual homeowners also use tax incentives to finance rooftop installations to power their homes. The financial benefits of these facilities vary by state.
The Sunshine State is the fastest growing
Florida continued to dominate the ranking of solar power states in 2023, installing 2.5 GW of new capacity in the first half of the year. That's 52% more than the next largest state, California, and already more solar power capacity than Florida has ever installed in a single year.
A recent ConsumerAffair study found that the average home solar installation will cost $16,715 in 2023 after federal tax credits.
The study found that the average cost of a residential solar system currently ranges between $2.50 and $5 per watt, not including incentives. Payback on installation costs usually takes five to fifteen years.
According to the study authors, this investment may be worthwhile if solar loan payments are lower than existing electricity bills.
Reported by Mark Huffman
Mark Huffman has been a consumer reporter for ConsumerAffairs since 2004. He covers real estate, gas prices and the economy and has reported extensively on negative retail sales. Previously, he was a reporter and editor for the Associated Press in Washington, DC and a correspondent for Westwood One Radio Networks and Marketwatch.
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