The solar industry is booming and is set to grow exponentially over the next decade. With the combination of improving technology, awareness, and economics, more consumers than ever are choosing to install solar in their homes.
According to the Solar Energy Industries Association only 250,000 of the approximately 100 million homes in the U.S. have solar, but that number is poised to grow rapidly. The USA ranks fourth on the list of nations that have installed the most solar-power technology, behind Germany, Japan and Spain, the association says.
While solar currently only provides 0.1% of the nations power, a recent study by Clean Edge and Co-op America said solar could provide 10 percent of the nation's power by 2025.
A number of US solar companies are showing significant growth and others are poised to enter the market.
Tempe-based First Solar Inc. reported that second-quarter revenue from its solar panels surged 245 percent, pushing profits higher than analysts expected. The company had revenue of $267 million, compared with $77.2 million in the same quarter last year.
But companies such as Intel, Applied Materials and National Semiconductor intend to capture their share of the lucrative market. After all, these large players aren't content to let start-ups control a photovoltaic solar industry projected to grow from $20 billion in 2007 to $74 billion by 2017.
Part of the reason for the growth has been the shifting economics, making solar an increasingly better option for homeowners.
Over the last two decades, the cost of manufacturing and installing a photovoltaic solar-power system has decreased by about 20% with every doubling of installed capacity. The cost of generating electricity from conventional sources, by contrast, has been rising along with the price of natural gas, which heavily influences electricity prices in regions with large numbers of gas-fired power plants. These regions include California, the Northeast, and Texas (in the U.S.), as well as Italy, Japan, and Spain.
As a result, solar power has been creeping toward cost-competitiveness in some areas. California, for example, combines abundant sunshine with retail electricity prices that, partly as a result of the state's policies, are among the highest in the country--up to 36 cents per kilowatt-hour for residential users. Unsubsidized solar power also costs 36 cents per kilowatt-hour, but support from the California Solar Initiative cuts the price customers pay to 27 cents.