Visualizing the remarkable progress of solar energy in the United States
Solar power is now at the center of U.S. plans for a decarbonized economy, accounting for 70% of planned utility-scale power capacity through 2025.
Solar’s rise to the top as a key energy resource now seems inevitable, but its fate was not always sealed. The technology was contributing a negligible amount of power less than ten years ago, and the Energy Information Administration (EIA) did not begin reporting annual net PV generation until 2014. In that year, solar contributed 27 TWh of electricity to the U.S. grid. Seven years later, it generated 164 TWh in 2021, multiplying generation sixfold.
Installed solar power capacity has climbed to 77 GW this year, the EIA reports, and has 72 GW of high-probability projects queued in the late stages of development, ready to come online through 2025. This will effectively double total installed capacity in three years.
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This progress has been made possible by supportive industrial policy, economies of scale, improved technological efficiency and business innovations. The levelized cost of electricity (LCOE) has declined over the years, and the benefits of solar power and energy storage become more apparent as the threats of climate change increase over the years.
The U.S. solar industry already has more than 250,000 workers, so far. In 2015, solar’s share of electricity sales was miniscule in many states, with California and Hawaii leading the way with a contribution of around 7%.
Just six years later, in 2021, solar has carved out a niche in every U.S. state, and in markets such as California, Nevada and Hawaii it has reached close to 20% of all power sales.
Solar-generated electricity was expensive in 2010. In the West, the LCOE was $173 per MWh, and reached nearly $400 per MWh in the East.
As of 2021, the LCOE has plummeted, as costs in PJM are nearly one-tenth of 2010, and projects in the West average less than $30 per MWh.
Crystalline silicon solar panels are the most widely used PV technology, although there have been promising advances in TOPCon, HJT, perovskites, tandem cells, and other emerging technologies. In the 1970s, solar cells achieved an efficiency of about 15%. Now, many commercial solar cells range from 21% to 27%, and emerging laboratory technologies have demonstrated efficiencies of up to 47.1%, reaching heights that researchers thought impossible.
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Looking to the future
The Inflation Reduction Act of 2022 contains $370 billion in spending for renewable energy and climate measures and calls for a 40% reduction in carbon emissions by 2030. Princeton University released a Rapid Energy Policy Evaluation and Analysis and Assessment Toolkit (REPEAT) in collaboration with Dartmouth College, Evolved Energy Research and Carbon Impact Consulting outlining the potential impact of the law.
The impact on the U.S. solar industry could be enormous to say the least. The Princeton report notes that solar deployment could accelerate from 2020 rates of 10 GW of capacity added per year to nearly five times that by 2024, adding 49 GW of utility-scale solar each year. Solar deployment could be well over 100 GW per year by 2030, according to Princeton.
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Solar investment could reach $321 billion by 2030, nearly double the $177 billion projected under current policy. According to the report, the bill would mean a cumulative capital investment of nearly $3.5 trillion in new U.S. energy supply over the next decade.
