Solar installations soar in second quarter but set to miss White House targets
The U.S. saw a surge in solar energy installations in the first half of 2021 despite price increases, but the growth rate remains below what is needed to reach White House climate targets, according to a new industry report.
The report, compiled by Wood Mackenzie and the Solar Energy Industries Association, found 5.7 gigawatts of solar power were installed in the second quarter of 2021, a 45 percent increase over the same period last year. The figure also represents the single largest amount in any second quarter on record.
In the first six months of the year, solar power comprised more than half of new electrical capacity added, at 56 percent, according to the report. Residential solar installations increased 2 percent from the first quarter of 2021 and 46 percent from the second quarter of 2020, which saw a severe dropoff due to the coronavirus pandemic.
The report projects solar installations will continue to remain in high demand and will surpass annual records for the next three years.
However, the report notes that even at those growth levels, the forecast shows overall growth coming in below the renewable energy goals set by the Biden administration.
The White House has set an overall goal of reducing greenhouse gas emissions by half by 2030, and last week announced a blueprint of 40 percent solar energy by 2035. While the U.S. surpassed this percentage for new electrical capacity installed in the first two quarters, the White House target focuses on overall capacity.
The industry report identifies several factors that could hurt growth in the near future. In addition to supply-chain constraints, it points to an order from Customs and Border Protection targeting certain Chinese silica-based solar products over suspicions of forced labor. The existing supply-chain issues have already led to sharp price increases during the second quarter of 2021, according to the report.
The report called that ban a “significant, widespread downside risk to our near-term outlooks.”
The reconciliation package currently before Congress, the report added, could address many of the short-term challenges with actions such as the extension of an industry tax credit. However, with no clear timeline, any actions contained in the bill are “fraught with obstacles and possible delays,” it states.
“This is a critical moment for our climate future but price increases, supply chain disruptions and a series of trade risks are threatening our ability to decarbonize the electric grid,” SEIA president and CEO Abigail Ross Hopper said in a statement. “If we want to incentivize domestic manufacturing and drive enough solar deployment to tackle the climate crisis, we must see action from our federal leaders.”