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Chart: The US installed more solar in 2023 than ever before
The industry saw 55% growth over 2022, according to forecasts — but headwinds threaten to temper the momentum in the years ahead.
www.canarymedia.com
This has been a record-shattering year for U.S. solar power. When 2023 comes to a close, nearly 33 gigawatts of solar capacity will have been installed across the country, according to the forecasts in the latest Solar Market Insights report from the Solar Energy Industries Association and Wood Mackenzie. That’s a significant leap from the 21 gigawatts installed in 2022 and the largest annual addition of solar in the nation’s history.
Solar is the fastest-growing source of electricity in the U.S., making up almost half of all new power capacity in the first three quarters of 2023. Thanks to this rapid expansion, the U.S. now has about 161 gigawatts of solar installed — enough to generate just about 5 percent of the country’s electricity. More than half of that capacity has been installed since 2020.
This year’s upsurge was driven by utility-scale installations, the largest segment of solar in the U.S. Utility-scale installations in 2023 are expected to have grown by 86 percent compared to last year, a strong rebound from a difficult 2022 that was plagued by supply-chain constraints.
While Wood Mackenzie anticipates another record-breaking year for new solar installations in 2024, it expects the industry to grow much more modestly — and for residential solar installations to struggle.
Residential solar installations are forecast to decline by 12 percent, due in large part to massive policy changes in California, which is the country’s biggest market for rooftop solar. In May, the state’s decades-old net-metering policy — a key incentive program for rooftop solar — was replaced with a structure that has roughly halved the financial value of residential solar for customers of the state’s three big utilities. Since then, the state has seen a roughly 80 percent reduction in rooftop solar projects.
Changes to California’s rooftop solar policy are not the only headwinds the solar market will face as it continues to expand. Lengthy interconnection waits, grid congestion and limited labor availability are all issues the industry will need to work through in the next few years.
But even in spite of those challenges, Wood Mackenzie expects that solar will keep rising to new heights in the years to come — by 2027, the total solar capacity installed in the U.S. will be nearly double what it is today.
