According to the International Energy Agency (IEA), renewable energy capacity will expand about 50% between 2019 and 2024. Currently, renewable energy resources comprise 26% of the world’s energy—a share that’s expected to increase 4% by 2024.
Solar capacity will grow 600 gigawatts (GW) globally by 2024, with overall renewable electricity (including wind and hydropower) growing 1,200 GW also by 2024. That’s the equivalent to the United States’ total electricity capacity.
Solar Power Predictions
According to 2018 data collected by the International Renewable Energy Alliance (IRENA), the US ranks third in solar energy use, behind China and Japan.
States spearheading growth of solar installations include:
- California: 972, 647 installations since 2019
- Arizona: 138,142 installations since 2019
- New York: 115,015 installations since 2019
- New Jersey: 105,453 installations since 2019
- Massachusetts: 92,076 installations since 2019
Industry experts predict solar expenses to decrease 35% in the next three years as the US doubles its solar installations to four million by 2023. With panel installation costs dropping, more states will continue adding to their solar power. Another big driver? Energy-dependent businesses and factories seeking to shrink their costs. Carbon Tracker predicted that by 2040, a whopping 72% of coal-based power will become globally unprofitable.
Solar power offers advantages over wind and hydropower, each generally requiring users to live in specific locations with access to their energy outputs. The sun rises and sets regardless of location. Solar facilities will store energy during the day and run at night, to help reduce and control variability rates. Newer solare plants will use higher DC to AC ratios, which enables them to deliver more consistent service for longer periods.
Solar Mandates & Regulations
To keep pace with capacity demands and the drive to embrace more renewable energy sources has led the federal and state governments to implement various incentives and remuneration and regulation policies. A 2020 California solar mandate, for example, includes a building code requiring any new construction homes include a solar photovoltaic (PV) system. This mandate includes multifamily buildings three or more stories high.
The U.S. Energy Information Administration (EIA) recently released its Summary of Legislation and Regulations Included in the Annual Energy Outlook 2021 report. This report provides renewable portfolio standards (RPS) for each state. AEO2021, which reflects state-level policies affecting projections of the electricity generation mix, divides the state regulations into “state RPS” and “state energy efficiency programs. AEO2021 reflects the state laws and regulations—or RPS—signed into law as of October 1, 2020.
According to this report, most states have met or exceeded required levels of renewable generation, in part thanks to RPS-qualified generation capacity that took advantage of federal incentives (some were phased out in December 2020) as well as the lower cost of renewable technologies including wind and solar.
The report included RPS requirements—as modeled for AEO2021—for each state. New Jersey’s aggregate renewable standards requirements are as follows:
- Target:
50% by 2030, with the solar portion reaching 5.1% in 2021 before decreasing gradually to 1.1% by 2033;
- Qualifying renewables:
Solar, wind, hydro, geothermal, LFG/MSW, and marine
- Qualifying other (thermal, efficiency, nonrenewable, distributed generation, etc.)
None
- Compliance mechanisms:
Credit trading allowed; state regulators set ACP. Solar and offshore wind are subject to separate requirements and have separate enforcement provisions
Characteristics of state efficiency requirements or goals as of December 2020:
- Type: E&G
- Targeted electricity savings (requirements and goals): 2% annual reduction from previous three-year average
- Percentage of sales covered: 100%
- 2019 incremental savings including annual MWh: 558,203
- Percentage of retail sales: 0.52%
Earlier this summer — and after many months mired in discussions within the NJ legislature—a bill promoting grid-scale solar projects hit Governor Phil Murphy’s desk. It increases annual costs of subsidizing solar projects to $1.2 billion, up from $750 million. It also eliminates a cap implemented two years ago to help reduce subsidies utility customers paid to solar developers.
Some experts within the solar industry worry that these new proposed incentives in the solar successor program—currently under development with the NJ Board of Utilities—don’t go far enough to support the state’s robust solar industry.
The state’s current administration finds itself faced with conflicts between competing state goals. It hopes to transition NJ to 100% clean energy by 2050. The trick, however, is doing so affordably—ratepayers already pay some of the highest electric bills nationwide.
In July, the state Senate approved bill A-4554, designed to encourage cost-effective, lower, grid-scale solar projects to more easily advance and for which environmentalists and solar developers lobbied heavily. Generating electricity via grid-scale projects costs less than residential installations and solar projects like panels installed on rooftops or carports.
Challenges come from certain conservation groups who object to transforming valuable farmland into solar farms. The legislation does include a compromise—a pilot policy to use 200 acres for dual farming. This experiment includes $2 million to evaluate the effectiveness and practicality of continuing to farm agricultural land that includes solar installations. If it works, this dual-use approach could preserve more farmland from conversion into warehouses.
Meanwhile, the Department of Energy (DOE) recently announced $128 million in new solar energy initiatives to reduce solar energy costs by more than half (60%) over the next 10 years and also improve performance and accelerate solar energy technology deployments. To achieve its goal of a zero emissions clean energy grid by 2035 requires installing solar energy systems up to five times faster than current speeds. The initiative also seeks to drop costs to $0.03/kWh in 2025 and $0.02/kWh by 2030.
Solar Energy: A Powerful Potential
According to the DOE’s Solar Futures Study, with continued investments in solar energy, by 2035, it has the potential (without increasing electricity prices) to:
- Power 40% of electricity in the US
- Drive deep decarbonization of the energy grid
- Generate up to 1.5 million jobs
The report says solar is the least expensive and fastest-growing clean energy source and points out that to achieve a clean grid will require the US to install an average of 30 GW of solar capacity annually until 2025 and increase to 60 GW annually between 2025 and 2030.
In addition to creating between 500K and 1.5 million jobs directly connected to the solar industry, decarbonizing the power sector will create about 3 million cross-sector jobs across technologies associated with the clean energy transition.
Projected health and cost savings—reduced carbon emissions and improved air quality—would outweigh the transition to clean energy, saving anywhere from $1.1 trillion to $1.7 trillion over time.
If you’ve got questions about renewable energy, talk to one of the members of CREA United. Robert Leech, managing member of Circuit Energy Group and Paul Abramson, Commercial Solar Energy Advisor for SolarKal, are well-versed in the energy industry and well-equipped to offer advice on the feasibility of solar installations for commercial properties.
