June 9, 2015 | By Barbara Vergetis Lundin

As the federal energy investment tax credit (ITC) gets set to expire at the end of this year, there has been a mad dash of solar photovoltaic (PV) projects in the United States aiming to get online before December 31, 2016.

PV Project Pipeline. Click on image to enlarge. Credit: IHS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

In fact, more than 32 gigawatts (GW) of projects greater than 5 megawatts (MW) are still in development or under construction, according to IHS -- the bulk of which are in California. However, several other states also have many large utility projects in development that they hope to be completed in 2016 or 2017.

For example, NextEra has reported that it will install 1.5 GW of Hanwha Q Cells modules across projects in several states, including California, Georgia, Florida, and Hawaii. Another example is Canadian Solar who dramatically increased its project pipeline in the United States, with its recent acquisition of Recurrent Energy.

 

"Many of these projects are set to be completed prior to the 2016 deadline, including a 150 MW project for Austin Energy in Texas and several other projects in California," said Christine Beadle, senior analyst for IHS Technology.

Lengthy delays in permitting and approval -- or the inability to secure a power off-taker -- could be critical, as developers strive to complete projects in all states in time to be operational and to qualify for the federal ITC, IHS warns noting also that areas in California are plagued with contentious environmental issues. Earlier this year, the Imperial Solar Energy Center West project was already under construction when work was halted for a few weeks because the flat-tailed horned lizard became a possible candidate for protection under the California Endangered Species Act.

"Newly proposed projects appear to be primarily located in less contentious areas and developed at sizes that are likely to promote a high potential for success in a short time," Beadle said. "Recent project approvals by the Bureau of Land Management encourage installations in designated Solar Energy Zones."

The most recent wave of proposed projects is in the 20 MW to 100 MW range. Some projects have been in development for a long time, but when size and location is optimal, there is a greater likelihood of success. Other projects in less optimal areas will eventually be completed, but probably not before the deadline, which seems to have affected priorities and caused a saturation of PV projects in certain areas, as noted by IHS.

If no bill to extend the deadline is signed into law, the federal ITC for commercial and utility solar projects will drop to 10 percent in 2017, IHS predicts. Completion of these projects prior to the deadline could be crucial to ensure financial viability. Any extension of the 30 percent federal ITC into 2017 or beyond would drive U.S. solar growth after 2016, as these early-stage projects will be ready to go into construction; however, an extension appears unlikely.

For more:
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http://www.fierceenergy.com/story/itc-expiration-creates-mad-dash-complete-solar-projects/2015-06-09