For the first time, solar power is now the top new energy source and credit for the milestone goes to large commercial projects that almost doubled in 2016, according to the Solar Energy Industries Association (SEIA). Solar accounted for 39 percent of new power coming on to the grid, more than natural gas, wind or coal.
Part of the reason for the increase in large commercial projects was because investors were worried about the possible expiration at the end of 2015 of the federal investment tax credit. Congress eventually extended the 30 percent credit for solar projects into 2021. Solar panels have also become cheaper and more competitive with fossil fuels.
The strongest growth came in large-scale production — solar farms typically capable of generating more than 1 megawatt. A megawatt of solar power can provide energy for about 160 homes and the utility-scale installations made up about 70 percent of the added capacity, according to the association.
One such project was the River Bend Solar Energy Center, the largest solar project ever in Alabama. It is a 640-acre solar energy center with approximately 300,000 solar panels that recently came online. It will be able to produce enough power to supply about 15,000 homes with carbon-free electricity.
According to Jay Stowe, vice president of distributed energy resources for the Tennessee Valley Authority, it will keep more than 100,000 tons of carbon dioxide out of the atmosphere every year. He said that was like taking more than 22,000 cars off the road for one year.
Analysts say the growth is driven by regulatory forces and falling solar panel costs across the country.
A record 22 states each added more than 100 megawatts of capacity. Utilities in southeastern states have begun building more solar projects, despite few regulatory incentives encouraging renewable energy, said Justin Baca, vice president of research at the association.
The market for residential and small commercials systems grew five percent last year, much slower than previous years. Baca said growth in the small, distributed market has slowed as the industry has matured.
The industry also reached record employment levels last year, with 260,000 workers, according to a report released last week by The Solar Foundation. The industry added 51,000 U.S. jobs and grew at 17 times the rate of the rest of the economy.
California remains the center of renewable business, with more than 100,000 people engineering, manufacturing, selling and installing solar products.