Now that solar technology is cropping up on rooftops across the country, you might be finding your friends and neighbors looking for more information about this “new” industry. Here are some current solar industry statistics and PV module trends for those increasingly common over-the-fence conversations.

The Numbers

According to GTM Research and the U.S. Solar Market Insight—2014 Year in Review by GTM Research and the Solar Energy Industries Association:

• “PV was a $13.4 billion market in the U.S. in 2014, up from $3 billion in 2009,” says Shayle Kann, senior vice president at GTM Research.
• In the United States, 6,201 megawatts (MW) of PV modules were installed in 2014, up 30% from the previous year. That made 2014 the largest year ever in PV installations.
• Residential PV installation continues to be the fastest-growing solar market segment in the United States, with 2014 marking three consecutive years of greater than 50% annual growth.

For the first quarter (Q1) of 2015 thus far (2015 U.S. Solar Market Insight Report):

• During the first three months of 2015, utility, commercial, and residential solar installations represented 51% of all new electric-generating capacity brought online, outpacing even natural gas.
• Residential solar installations grew by 76% compared to the first quarter of 2014, with 437 MW of residential PV installations. That’s an 11% jump over the previous quarter, the market segment’s previous high-water mark.
• Through Q1 of 2015, nearly 25% of total residential PV instal­lations to date, have now come online without any state incentives.
• PV installations are forecast to reach 8.1 GW for  2015, up 31% over 2014. Growth will occur in all segments, but will be most rapid in the residential market.

Money Trends

PV system costs continue to decline. Retail PV modules average $0.72 per watt (as of Q1, 2015). Although that’s not a fluctuation from last year’s average, the average cost of a fully installed residential system continues to drop due to decreases in balance-of-system (BOS) and “soft” costs. As of Q1 in 2015, it’s at $3.46 per watt, 10% lower than Q1 of last year.

One factor impacting module prices is the ongoing (three years now) trade dispute between the United States and China, resulting in tariffs on Chinese modules. In 2012, an investigation was launched to determine if Chinese module manufacturers were “dumping” (i.e., selling their products in the United States at prices less than fair value) and, if so, to establish antidumping (AD) duties. Additionally, countervailing duties (CVD) were to be determined to address Chinese government assistance and subsidies used to enable Chinese manufacturers to sell modules more cheaply than U.S. manufacturers.

As of July 2015, the Department of Commerce completed its administrative review of the investigation, and imposed duties on Chinese module manufacturers (combined AD and CVD) will range from 21.7% to 259.9%. There is also a separate second investigation, launched in 2014, that is aimed at dealing with companies who moved their production to Taiwan to avoid the tariffs.

While it doesn’t directly impact module pricing, the expiration of the federal solar investment tax credit (ITC) at the end of 2016 will impact the PV industry. Currently, PV system owners can recoup 30% of the installed system cost at tax time, but that will no longer be the case should the ITC expire. In an effort to extend the ITC, California U.S. representative Mike Thompson introduced H.R. 2412, the “New Energy for America Act,” which includes a provision to extend the ITC for an additional five years. Those interested in supporting this legislation can find more information at seia.org.

Home values increase beyond the PV systems’ cost. In January 2015, Lawrence Berkeley National Laboratory released Selling into the Sun: Price Premium Analysis of a Multi-State Dataset of Solar Homes, which examines the sale of homes with PV systems in eight different states. Their findings, which included home sales spanning 2002 to 2013, describe how a PV system raises a home’s value by about $4.17 per watt.

Using the current average system cost of $3.46 per watt, that would mean a 3,600 W system that costs $12,500 (or $8,700 after the federal tax credit) could increase a home’s value by about $15,000 for resident-owned PV systems. It is important to note that this study and its findings are specific to systems owned by homeowners, and does not apply to leased systems. To our knowledge, an analysis of leased systems and their impact on home values has not been completed.  

Tech Trends

PV module efficiency continues to climb. In the last 15 years, average PV module efficiency has gone from about 11% to 16% for typical crystalline silicon modules, to more than 20% for high-efficiency “back-contact” modules, which have no light-blocking metallic traces on front of the PV cells—this increases the available light-collection surface for a higher conversion efficiency. Also more efficient (about 17% to 19%) are conventional modules using “n-type cells,” which have less light-induced-degradation and are less sensitive to cell impurities that the conventional “p-type cells.”

Thin-film PV modules have also come a long way with efficiency, increasing from about 5% to now 16.3% (First Solar’s cadmium telluride module). Although First Solar modules are aimed at the utility-scale market, Stion offers thin-film modules with up to 14% efficiency that can be purchased for residential installations.

Bifacial modules, which have efficiencies greater than 20%, are making a comeback. Generally, these modules surround monocrystalline n-type cells with a layer of amorphous silicon (a-Si) and harvest energy on both the back and front of the module. Panasonic offers its HIT Double module with efficiency rated at 20.8%; Prism Solar and Sunpreme bifacial modules have 20.5% and up to 22.9% efficiencies, respectively. Bifacial efficiencies assume energy contribution from the back of the module. To achieve top efficiency, bifacial modules need to be mounted so that the back is not blocked (such as in a shade structure with “perimeter-framed” mount).

Greater module efficiency means generating more electricity in a smaller footprint. With fewer rack materials and a shorter installation time, this can mean lower installation cost per watt. For example, an 8 kW system using modules with 16% efficiency would require about 535 square feet. That same size system using modules with 21% efficiency would only take up 410 square feet. However, because higher-efficiency modules are more expensive per watt, higher efficiency doesn’t always mean less-expensive PV-generated electricity (see “Ask the Experts” in HP168 for a helpful comparison).

Evolving PV module reliability and quality assurance measures. While module prices didn’t decline in 2014 over 2013, module pricing has gone from $4 per watt to $0.72 per watt since 2008. This dramatic price drop has partially stemmed from cost-cutting measures in the manufacturing process, which could impact module reliability. For example, according to the International Energy Agency’s “Review of Failures of Photovoltaic Modules” (March 2014), the majority of module failures stem from interconnections within the module (i.e., breaks in the ribbons and solder bonds) or problems with backsheets and encapsulants (delamination).

To counterbalance these types of manufacturing issues, various PV industry stakeholders support establishing third-party accelerated testing facilities—and developing new guidelines to help assure quality in PV modules. Specifically, the International PV Quality Assurance Task Force (PVQAT), co-led by the National Renewable Energy Laboratory, was established to craft quality and reliability standards for module durability, manufacturing consistency, and even certify full PV systems to verify PV system design, installation, and operation. This international effort is well underway but, typical of volunteer efforts, will take some time to build consensus before standards are released. Check out PVQAT progress at pvqat.org.

In the meantime, module manufacturers can opt to have their products pushed through accelerated performance testing and be continually monitored by an independent testing facility, such as Intertek, PV Evolution Labs, TUV Rheinland, and Underwriters Laboratories (UL).

PV module fire-class ratings replaced by module “types.” Historically, PV modules obtained fire ratings under the UL1703 listing process, and rooftop modules were rated as Class A, B, or C—with most at Class C. Due to new building codes (see the “Fire-Resistance Ratings” sidebar), this approach has become insufficient, since these ratings are only for the modules themselves—and do not take into account the rack system and the roof type. Now, modules tested under the new UL1703 process receive a “type” classification instead. There are currently 15 types of modules listed, and those types are based on module construction materials (superstrate, encapsulant, substrate, and frame types) along with fire performance.

These module types are used along with PV rack system ratings to achieve the required PV system fire-resistance. For example, if a PV rack has a Class A PV system fire rating using a “type 2” module, then an installer must use a “type 2” module with that mounting system for any buildings requiring a Class A roof. Additionally, manufacturers’ installation instructions must be carefully followed to retain that fire-resistance classification.

Higher-impact hail testing for PV modules. As more intense storms become common, there’s a greater risk of larger hail and a higher potential for PV module damage. Historically, PV modules have been tested with 25-millimeter diameter (~1 inch) hailstones striking the modules at 23 meters per second (51 mph). In response to extreme weather events, more stringent hail tests such as the “hail stone impact test level 4” (HW4) and a “high-grade hailstone impact test” have been developed. HW4 uses 40 mm (1.6 in.) hailstones at 27.7 mps (62 mph); the high-grade hailstone impact tests modules with 45 mm (1.8 in.) hailstones at 30.7 mps (68.7 mph). After testing, the modules are checked for performance degradation and mechanical damage. It is likely that modules will increasingly be tested with these newer tests so manufacturers can market their durability.

What’s Next

As a whole, the PV industry continues to enjoy sustained growth and technological developments each year. It is encouraging to see system costs drop year after year, accompanied by increased safety and durability measures, as well as a focus on improving system quality assurance. In many regions, PV systems have become cost-competitive with utility energy prices, and it is expected many more areas will experience the same trend. As a result, the solar revolution continues, and we get to increasingly experience the joy of helping our friends and neighbors join our solar community.