Most Attractive States For Investing In Solar

by Zachary Shahan.

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Originally published on Cost of Solar.

–> See how much money solar power could save you!

There are a lot of ways to evaluate the attractiveness of a place for renewable energy or solar energy investment, and to evaluate the best solar states. Of course, it depends on what factors and assumptions you take into account, as well as what segment of the market you are actually evaluating.

One of the leading evaluators of such markets is Ernst & Young (EY). The “professional services firm” recently released its most up-to-date renewable energy attractiveness indices for the US, including a solar energy index. The report includes solar market data for 2012 as well as a well-researched ranking of states by their solar energy investment attractiveness. The overall summary is clear, as we have been writing for months here on CostofSolar.com: the US solar market is booming.

US Solar Market Booming

“In 2012 the US installed 3,313 MW of solar photovoltaic (PV) capacity, with 1,300 MW coming in Q4 alone, surpassing both annual and quarterly records. Even with falling costs the dollar value of the market size of the US solar industry grew 34% in 2012,” EY writes. “The cumulative total of solar PV in the US is now at 7,221 MW, with cumulative PV installations exceeding 300,000 individual units.”

A new solar panel installation is now occurring every 4 minutes in the US, according to an analysis from GTM Research.

Solar Leasing Is Hot

As I’ve reported a few times previously, solar leasing is hot. This is partly due to the fact that residential solar power has become quite cheap, and partly due to the fact that people are attracted to $0 down purchasing options, especially when the products (i.e., solar panels) save them money from Day 1. This makes going solar a no-brainer (even more than it already is).

EY writes: “Third-party ownership or leasing of rooftop solar PV systems in the US accounted for more than 50% of the residential and commercial market in 2012. Average residential system prices dropped nearly 20% between Q4 2011 and Q4 2012, and industry experts expect this segment of the market to surge as third-party financing options spread throughout the country.”

US Southwest Is Hot

The leading states are largely in the Southwest, thanks in part to its tremendous solar energy potential, but there are some outliers.

“The top five states for solar electric capacity installed in 2012 were California (becoming the first state to install over 1,000 MW in a single year), Arizona, New Jersey, Nevada and North Carolina, while the leaders in cumulative solar capacity installed through 2012 were California, Arizona, New Jersey, Nevada and Colorado.”

The 10 most attractive states for solar energy investment, according to EY, are now:

Best Solar States For Return On Investment (ROI)

Overall, I find the EY report very useful, as it includes fairly comprehensive policy and market analyses, and even does so for the top solar states.

However, as people who have read me for awhile know, I’m a big fan of relative rankings… of which there are very few. Looking at absolute rankings such as total solar power capacity, you miss who is leading the way on a per capita or per GDP basis. And you miss which states offer the best return on investment for a single residential solar power system.

If you’re curious about the latter, you may have noticed that we’ve already shared a great ranking on that, which changed the above order a bit to come up with this top 10 ranking:

  1. Hawaii — 24% IRR
  2. DC (if you want to include it) — 20% IRR
  3. New York — 17% IRR
  4. Connecticut — 16% IRR
  5. Colorado — 15% IRR
  6. Massachusetts — 15% IRR
  7. New Mexico — 13% IRR
  8. California — 12% IRR
  9. South Carolina – 12% IRR
  10. Delaware – 12% IRR
Best Solar States Per Capita

At the end of 2012, the top solar states for installed solar power per capita ranking shuffles the top solar states around yet again:

top-solar-states-per-capita-total

Image Credit: Zachary Shahan / CleanTechnica. Data Credit: GTM Research / SEIA.

top-solar-power-states-per-capita-total-solar

Image Credit: Zachary Shahan / CleanTechnica. Data Credit: GTM Research / SEIA.

Best Solar States… Depends On Your Aims

In the end, I think all of this data is quite interesting. And it offers useful lessons of different types. The EY ranking is certainly useful to investors and major companies who want to figure out the policies and market of one or more states in order to invest in solar projects for the best return on investment (ROI). It also helps show how large states and even countries can better promote solar power.

The solar ROI study briefly mentioned after that is actually useful for the same thing (through slightly different data and research). But it’s also useful for individual homeowners or small businesses who are considering the switch to solar.

And the per capita rankings show us who the true state leaders are, showing us which states’ solar or electricity policies would be most worth emulating.

But, really, for our main audience (the common Joe), there’s simply one thing to do: find out how much solar power could save you, get connected to the best installer for your money in your region, and go solar so that you can start savings tens of thousands of dollars off your electricity bills.

The longer you wait to make the switch, the more money you are throwing away on dirty power from a monopolistic utility company. And the fact is, you can get an estimate of how much you’d save in less time than it takes to watch another cat video or Gangnam Style.

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This article, Most Attractive States For Investing In Solar, is syndicated from Clean Technica and is posted here with permission.

About the Author

Zachary Shahan is the director of CleanTechnica, the most popular cleantech-focused website in the world, and Planetsave, a world-leading green and science news site. He has been covering green news of various sorts since 2008, and he has been especially focused on solar energy, electric vehicles, and wind energy for the past four years or so. Aside from his work on CleanTechnica and Planetsave, he’s the Network Manager for their parent organization – Important Media – and he’s the Owner/Founder of Solar Love, EV Obsession, and Bikocity. To connect with Zach on some of your favorite social networks, go to ZacharyShahan.com and click on the relevant buttons.

5 Solar Growth Markets That May Surprise You

by Zachary Shahan

U.S. PV Market Growth Through 1H 2013
U.S. PV Market Growth through the First Half of 2013.

Originally published on Cost of Solar.

You probably know which states have been strong solar growth states over the past several years — California, Hawaii, Arizona, New Jersey, North Carolina…. But below are 4 states and one city that are picking up some serious steam in the solar power arena (can I use “pick up steam” with solar PV?), and that you probably wouldn’t guess are primed to become solar leaders.

GTM Research, which revealed these at Solar Power International last week, has termed them “hidden growth opportunities.” GTM Research projects a total of over 1 gigawatt (1 billion watts) of solar PV demand in these markets between the second half of this year (2013) and 2016. That’s a lot. Solar panel suppliers are going to love these 5 markets.

So, let’s very quickly check out these hot (or soon to be hot) solar markets (in no particular order):

1. Minnesota

Not exactly the sunniest state in the US, state requirements that utilities get 1.5% of their electricity from solar power and 10% from distributed, small-scale power generation systems (systems 20 kilowatts or smaller, such as home solar systems), as well as net metering (which allows solar power producers to sell their electricity back to the grid at retail electricity prices) for systems up to 1 megawatt (MW) in size, could help boost Minnesota’s solar power capacity from about 13 MW today to about 450 MW by 2016. We’ll see….

Notably, for homeowners who go solar in Minnesota, you’re expected (on average) to get a 10% internal rate of return (IRR) on your investment, which beats the S&P 50-year CAGR of 9.9% — very, very good.

2. Virginia

Virginia has low electricity rates and not the best solar resources around. So, how is this state showing up as a hot solar market? Well, a Virginia law, HB 2334, requires that Virginia’s large utility, Dominion Energy, implement a 50-megawatt PPA renewable energy pilot program. 50 megawatts is a sizable pilot project, and who knows what it might stimulate? Virginia also has net metering. Unfortunately, it doesn’t have much else going for it when it comes to solar power, except perhaps a lot of people who would like to rely on their own clean electricity source while also saving money. Those are a couple of big incentives, aren’t they?

Investing in solar in Virginia may not be as lucrative as investing in solar in Minnesota, but it’s still projected to save/make the average homeowner more than investing in a 30-year U.S. Treasury Bond or 5-year CD. Homeowners should be going solar in a heartbeat for the IRR available here.

How much will solar save you? Find out in about 60 seconds!

3. Washington, DC

Yes, here’s the non-state. so, I’m sure you’re wondering: what does this little city have that so big to have put it in this list? For one, 2.5 percent of DC power must be from solar by 2023 (projected to be about 250 MW of power capacity). And the city has an undersupplied Solar Renewable Energy Certificate (SREC) market, meaning there’s a lot of need for growth there. Also, net metering in DC is allowed for projects up to 5 MW in size (quite large), allowing for more people to take part in (and profit from) relatively large solar projects, even “community solar gardens.”

Investing in solar in DC has a better average IRR than in any state in the US other than Hawaii. 20%! It’s almost a crime to own a roof in DC and not invest in solar power. Also, thanks to the city’s progressive net metering law, even if you don’t own a roof but live in DC, you can take advantage of that great IRR by investing in a community solar garden. Solar panel suppliers must be drooling looking at the DC market.

4. Louisiana

Louisiana has great solar resources, but almost no solar power installed. GTM Research seems to be hopeful that the market will wake up a bit down there in the coming few years. While there aren’t state requirements for utilities to increase their use of solar power, there is net metering and a state tax credit for solar panel installations through 2017. On average, the projected IRR for someone who goes solar in Louisiana is an extremely attractive 9.4%. It’s a no-brainer.

5. Georgia

Another Southern state with little solar power capacity today and a lot of room for growth is Georgia. A few big new policies look to grow the solar market in Georgia considerably, even though solar leasing remains off the table legally. As GTM writes: “Demand for solar in Georgia will be driven by an attractive feed-in tariff and utility-scale RFPs for twenty-year PPAs. The Georgia Advanced Solar Initiative offers 13 cents per kilowatt-hour for distributed generation and 12 cents per kilowatt-hour for utility-scale solar.” Once those are in place, hold on to your hands, solar power installations are going to be flying into place all over the state.

All in all, cities and states across the country are looking to see a lot of solar power growth in the coming years. ¾ of US solar power installations were connected to the grid within just the past 2½ years, ⅔ of solar PV panels shipped around the world by solar panel suppliers have been shipped just within the past 2½ years, and that pattern of rapid solar growth is expected to continue. Solar panel costs have dropped about 60% since early 2011. There’s no reversing that dramatic fall. The market is maturing, and as a market matures, costs come down.

The 5 markets above seem primed for much stronger solar power growth than they’ve seen so far. If you’re in one of these states or DC, you might want to have a look at the solar incentives that are available where you live. Or, even better, you can have us help you with that while you also get hooked up with a local solar contractor and get professional estimates of how much solar would cost you and how much more you could save by going solar.

Repost.Us - Republish This Article

This article, 5 Solar Growth Markets That May Surprise You…, is syndicated from Clean Technica and is posted here with permission.

About the Author

Zachary Shahan is the director of CleanTechnica, the most popular cleantech-focused website in the world, and Planetsave, a world-leading green and science news site. He has been covering green news of various sorts since 2008, and he has been especially focused on solar energy, electric vehicles, and wind energy for the past four years or so. Aside from his work on CleanTechnica and Planetsave, he’s the Network Manager for their parent organization – Important Media – and he’s the Owner/Founder of Solar Love, EV Obsession, and Bikocity. To connect with Zach on some of your favorite social networks, go to ZacharyShahan.com and click on the relevant buttons.

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