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10 Things Everyone Should Know About Solar Energy
Solar Energy is Big Business Globally 46 GW of solar energy was installed in 2014 Solar investments grew 25% to $149.6 billion in 2014 The market is expected to grow 16% to 25% in 2015 Images source: First Solar
U.S. Solar Market is Booming U.S. solar installations grew 30% to 6.2 GW in 2014 63% of installations were large utility scale projects Solar energy accounted for 32% of all electricity generation built in 2014 Source: GTM Research
Residential is the Smallest Market Just 20% of U.S. installations were residential projects Image source: SolarCity
Number of Rooftops in U.S. NREL estimates there is 661 GW solar generating potential from U.S. rooftops. The total electricity generating capacity of all coal power plants in the U.S. is 336 GW. Image source: SolarCity
Subsidies Are Falling The solar industry is growing as subsidies drop around the world. Germany’s solar feed-in tariff that was once more than double the cost of electricity is now lower than the cost of electricity. California’s solar market is booming despite reductions in the California Solar Initiative. SunPower and SunEdison have built projects in Chile without subsidies that are selling into the spot electricity market. The U.S. investment tax credit (the largest solar subsidy in the U.S.) is due to expire in 2017.
The Cost of Solar is Dropping Rapidly According to GTM Research, since Q1 2010 the cost of solar has dropped dramatically. Residential system costs are down 50% to $3.48/watt. Commercial costs are down 65% to $2.25/watt. Utility scale costs have fallen 62% to $1.83 per watt. Source: GTM Research
Solar Could Power Cars Someday Electric vehicles are growing in popularity and solar energy could play a big role in that growth. The Ford C-Max Solar Energy (seen below) includes solar cells in the roof that recharge the car passively. Solar energy would allow for free energy with little effort for users outside of finding a sunny parking spot. Image source: SunPower
Solar is Where the Jobs Are The number of people employed in the solar industry in the U.S. has increased 86% since 2010 to 173,800. Twice as many people work in the solar industry as in coal mining. Image source: SunPower
Many Solar Companies Are Profitable Image source: SunPower and First Solar. Despite reports of bankruptcies in the solar industry (Solyndra) stable and profitable companies are beginning to emerge. In 2014, First Solar reported net income of $245.9 million. SunPower reported net income of $397 million last year. Many Chinese manufacturers like Canadian Solar, JinkoSolar, and Trina Solar have also begun reporting quarterly profits.
There Are Many Ways to Invest in Solar Investors can now choose between a variety of public solar companies to get exposure to the industry. Solar investments were once restricted to high risk module manufacturers, like First Solar and SunPower. Today, yieldcos have emerged as a way for investors to own solar projects with long-term electricity sales contracts. NRG Energy, TerraForm Power, and the upcoming IPO of 9point3 Energy Partners are just three high quality examples of a yieldco. Investors can also invest in residential solar (SolarCity and Vivint Solar), utility solar (First Solar), or diversified companies (SunPower). Image source: SolarCity
U.S. energy is booming and now is the time for investors to profit. Find out how today.