Report: Solar installations surged in 2011

"The solar industry is the fastest growing industry in America for the second year in a row. What we are seeing in the U.S. is that policies are working to open new markets and remove barriers for solar," SEIA President Rhone Resch said in a statement.

"The industry is now poised for years of multi-gigawatt growth and the creation of tens of thousands of new jobs.”

The capacity installed in 2011, which the report says can power 370,000 homes, represents a 109 percent growth from 2010. The report estimates that an additional 1,000 megawatts of capacity are under construction and will come online this year or next.

Solar energy is a key part of President Obama’s clean energy plan. The plan has come under attack from Republicans after the failure of California solar panel maker Solyndra, which received a $535 million taxpayer-backed loan in 2009.

But the solar industry has worked to overcome the GOP criticism, highlighting its recent growth and arguing it is a job creator.

The solar industry faces a number of challenges, including uncertainty surrounding government incentives and major competition from countries like China, which have invested billions in the industry.