U.S. solar had a strong first quarter, but the coronavirus will pose challenges going forward
- Solar power in the U.S. has, like many other sectors, been hit by the coronavirus pandemic.
- It's projected that 113 GW will be installed between 2020 and 2025.
The American solar industry installed 3.62 gigawatts of photovoltaic capacity during the first quarter of 2020, a record amount for the period, according to new analysis published Thursday.
While the number may sound encouraging, the U.S. Solar Market Insight Q2 2020 report, released by the Solar Energy Industries Association (SEIA) and Wood Mackenzie, painted a mixed picture for a sector which has, like many others, been hit by the coronavirus pandemic.
Photovoltaic refers to a way of directly converting light from the sun into electricity, while capacity is used to describe the maximum amount that installations can produce, not what they are currently generating.
In a statement, the SEIA noted that while the "first quarter of the year was largely unaffected by the pandemic," impacts were "expected to appear beginning in the second quarter."
Abigail Ross Hopper, the president and CEO of the SEIA, said the solar industry had "certainly been impacted by the pandemic, resulting in uncertainty for businesses and 72,000 Americans out of a job."
Wood Mackenzie is projecting close to 18 GW of installations this year, which would represent yearly growth of 33%. Due to the impact of Covid-19, however, the figure is 9% lower than the almost-20 GW of installations previously forecast.
Longer term, it's now projected that 113 GW will be installed between 2020 and 2025, a drop of 3.6 GW compared to an earlier forecast.
"While the utility segment shows promise with sustained levels of procurement so far, lower energy demand due to productivity loss and wholesale electricity market price drops will add to the uncertainty," Ravi Manghani, head of solar at Wood Mackenzie, said in a statement.
"All in all, the pandemic and the ensuing economic slowdown will weigh heavily on the solar industry in the coming months if the economy is slow to recover and financing dries up."