U.S. solar installations are expected to soar 43% this year, just shy of a pre-pandemic forecast, as the industry has recovered more quickly than expected from a virus-related slowdown, according to a report by the top solar trade group.
The improved outlook reflects robust demand from utilities seeking to meet carbon-reduction goals and a rebound in demand for home solar systems, thanks in part to declining costs for the technology.
The sector is now expected to install more than 19 gigawatts of solar this year, enough to power more than 3.6 million homes, according to the U.S. Solar Energy Industries Association (SEIA) and energy research firm Wood Mackenzie. Last year it installed 13.3 GW of capacity.
Solar energy also accounted for 43% of new U.S. power capacity additions through the third quarter, compared with less than a third for wind and natural gas.
The solar industry has been growing rapidly in recent years thanks to declines in the cost of the technology that enable it to compete with power generated by coal and gas. Even so, just 3% of U.S. electricity is now generated by the sun. SEIA hopes that will rise to 20% over the next decade.
New project announcements from U.S. utilities during the quarter prompted SEIA to revise its installation forecast for 2021 to 2025 upward by 10 GW to 107 GW.