How California Can Continue its Solar Energy Growth

Now that we are two months into 2014, we are taking some time to reflect on how 2013 was for the solar industry and what lessons can be learned from the biggest developments.  By almost all counts, it was a big year for solar power.

Across the nation, residential solar installation became more popular thanks to general education of the public about the advantages of the technology and available rebates that help make it more affordable. Additionally, utility companies made a big effort to get large-scale installations up and running (such as Ivanpah in Southern California’s desert).  All of this lead to a surge in solar panel installation and a number of record breaking quarters in 2013.

Looking Back on California’s Solar Growth

Of course, California continues to be one of the leading states for solar expansion.  Our state doubled its total generating capacity for rooftop solar, adding as much photovoltaic (PV) power in 2013 as it had in the 30 years prior. In total, we now have 2,000 megawatts (MW) of rooftop solar.

When you consider utility-scale installations such as the California Valley Solar Ranch, the Golden State actually has a grand total of 4,000 MW of capacity. This makes California by far the state with the most solar, and accounts for a little under 40 percent of all U.S. PV and concentrated solar power.

Why Solar Energy is Rapidly Growing

Having established that the solar industry is growing at a rapid pace, it’s worth understanding why this happened and how we can continue expanding:

• Continuing public policy support: Solar power has enjoyed a very favorable public policy climate so far. The state government and power regulators have continued to fund programs and rebates that make this technology more affordable and accessible to families of all incomes. However, utility companies across the country have been pushing back against these efforts by trying to limit the value of net metering benefits. Regulators should resist calls from these corporations to cut back on rebate programs and continue to provide incentives for the adoption of clean energy technology.

• Declining panel costs: By far the biggest driver in the growth of California solar energy is the fact that module prices have fallen dramatically in the last several years. This trend continued well into 2013, when solar panels dropped in cost by over 9 percent. These decreases are the result of a number of factors, including the fact that solar panel manufacturers have made significant gains in streamlining the supply chain.

• Reducing soft costs: Many industry experts are concerned that panel prices can only come down so much before they “hit bottom,” which means that Los Angeles solar installers are going to need to look at reducing soft costs to continue the downward trend. Soft costs are those aspects of solar production that aren’t dictated by panel prices, such as installation, labor, administrative expenses, supply chain inefficiencies and permitting fees. It’s best for the solar industry to address these problems from both a public policy and innovation standpoint.

In order for Los Angeles and Orange County solar to remain competitive in the future, it is essential for the trends outlined above to continue. That way, the state, and the nation, can move closer to a more sustainable and energy-independent future.