Solar PV will account for 40% of the total renewable energy capacity this year and is expected to reach 47% by the end of 2026. In 2023, the US will generate 240TWh of solar photovoltaic electricity, which will account for 22% of renewable power.

Solar PV capacity in the US will reach 184GW by the end of 2023, 19% higher than last year. Solar PV demand is expected to exceed 265GW in 2026, producing over 376TWh of clean energy, almost 12% higher year on year.

In 2023, utility-scale solar systems will account for almost 68-70% of the country’s total solar capacity and this rate will remain roughly the same until 2026. Supportive new policies and incentives will help expand PV residential system capacity this year to 32GW, 15% higher from 2022. PV residential capacity is set to almost double over the next four years in the US.

Additionally, supportive policies in the country will support a capacity increase in commercial solar systems from 22GW to 25GW in 2022-2023. An additional 3GW of commercial solar is expected to be installed per year in the US to reach 33GW by 2026.

Solar Energy Incentives from US IRA 

In August 2022, President Biden signed into law the Inflation Reduction Act (IRA) to expand support for renewable energy in the next 10 years primarily through tax incentives up to US$369bn, as well as other smaller measures.

The IRA will raise tax credits for solar installation to 30% from 26% in 2020-2021. The bill contains US$40bn in tax credits to support the country’s goal of boosting annual solar manufacturing capacity to 50GW by 2030.

The IRA extends the Investment Tax Credit (ITC) to the end of 2025 for solar, wind, geothermal, biogas, combined heat, and power (CHP) facilities, and microgrid projects that began construction before that date. It includes interconnection ITC costs, as well as eligible costs associated with standalone energy storage. Additionally, the IRA extends the Production Tax Credit (PTC) for solar, wind and other renewable energy projects.

In the case of the PTC, the tax credit can increase 10%, if the solar projects use domestically produced materials, such as steel and iron, and if the total materials for the project are at least 40% made in the US.

The ITC will increase by an additional 10% for solar generation projects that are placed into service in an ‘energy community’, as well as an additional 10-20% if the project is located in an ‘environmental justice’ area.

The IRA also provides the opportunity for project developers to transfer the ITC or PTC to a third party who must pay in cash for the tax credit. The developer must choose to transfer the tax credit or claim the tax return in the year in which the credits are eligible to claim.

Latest US Solar Developments

Solar energy currently accounts for just 4% of electricity production in the US—but that’s set to increase significantly. The IRA—the biggest legislation in clean energy manufacturing in US history—will generate almost US$1.6tn in revenue by leveraging tax dollars within a decade.

Savion is developing the country’s largest solar plant in Ohio with an 800MW capacity, overtaking 690MW Gemini Solar project in Nevada. The Oak Run solar project, requiring an investment of US$1bn, will create over 3k construction jobs and generates US$505m in tax revenue over its lifespan.

The estimated tax revenue for Ohio is in the range of US$243m-$505m over the 30–35-year lifetime of the solar plant. The solar project is planned to be installed on 6k acres of land located in rural Madison County. Construction will begin in 2023 is expected to be operational in early 2025.

Meta, the parent company of Facebook, has signed a purchase agreement with Apex clean energy for the 195MW Angelo solar project in Texas. The project is expected to support 100% of Meta’s regional operations with clean energy.

Angelo Solar’s commercial operations will start in early 2024. The project is expected to generate US$31.7m in tax revenue for the local community and at least US$22m in landowner payments. During construction, the project will create almost 400 jobs. Meta remains the top corporate procurer of solar projects in the US, after installing more than 3.6GW of renewables through 2022.

Looking at technology, researchers at the US National Renewable Energy Laboratory (NREL) have built an ultrathin covering layer to protect a perovskite solar cell from the harmful effects of space and harden it against environmental factors on Earth.

Weather issues are the biggest challenges on earth for the stability of solar cells, however, in space, solar cells must address problems that come from radiation bombardment and extreme temperature swings. The Perovskite show signs of tolerating radiation better than many other solar cells, according to a recent report from NREL.