The SEIA and Wood Mackenzie report claims the US commissioned 9.3 GW of module manufacturing capacity in Q3 2024
It added 8.6 GW DC of new PV capacity during the quarter, led by over 6 GW of utility-scale capacity
Annual installations this year are forecast to be 40.5 GW DC due to 26% decline in residential segment
The US solar module manufacturing capacity continues to scale up as the market brought online a record 9.3 GW in Q3 2024, expanding the country’s cumulative operational capacity to 44.4 GW. It was also a remarkable quarter for the country as silicon solar cell production resumed for the 1st time since 2019, according to the Solar Energy Industries Association (SEIA) and Wood Mackenzie.
However, according to their latest release U.S. Solar Market Insight Q4 2024 report, 12.8 GW of the cell production capacity is currently under construction and 34.1 GW has been announced. For polysilicon, the operational capacity adds up to 34 GW, with another 8 GW in announced plans. Solar ingots and wafer manufacturing capacity of 13.3 GW and 24.3 GW are expected to come online.
For modules, the US currently has 24.1 GW capacity under construction, and another 13.1 GW has been announced. Within 2024, the country brought online 24 GW of new module production capacity, a momentum spurred by the Inflation Reduction Act (IRA).
“As the industry faces uncertainty as a result of new trade action, U.S. solar manufacturing will be help ease the supply challenges that have hampered the industry in years past,” stated the analysts.
There is growth even in the storage supply chain capacity with 12.3 GW of battery cells, and 52.6 GW of battery packs already in operation.
Installations
During the reporting quarter, the US solar market expanded by 8.6 GW DC, representing a 21% year-on-year (YoY) increase, and the largest Q3 ever for the industry. Nevertheless, on a quarter-on-quarter (QoQ) basis, this was a decline of 13%.
The utility-scale segment continues to be the driver for the PV industry installing 6.6 GW DC, a 44% YoY increase and a 16% QoQ decline. Growth in this segment in the future will be driven by high demand from states, utilities, and corporations. A recent American Clean Power Association (ACP) report counts the utility-scale segment to have close to 91 GW capacity in the pipeline (see Solar Energy Accounts For 61% Of US’ Q3 2024 Clean Energy Utility Installations).
The utility-scale segment was followed by the residential segment, which installed 1.1 GW DC. While the installations were up 39% YoY, the 4% QoQ decline was due to elevated interest rates and customer uncertainty. This year, the report writers expect this segment to contract by 26% compared to 2023.
The commercial solar segment witnessed a huge jump of 17% QoQ and 44% YoY, installing 535 MW DC. This segment, comprising on-site installations for businesses, non-profits and governments, is expanding from the traditionally strong markets of California, Massachusetts, New Jersey and New York, thanks to the federal tax credits.
The community solar segment, on the other hand, declined 17% QoQ to 291 MW DC, but represented a 12% YoY jump. Slowing momentum in New York was one of the reasons for the drop, according to the report.
Overall, solar PV accounted for 64% of all new electricity generation capacity added to the US grid during the reporting quarter. Texas led the states with 2.4 GW of new capacity added, accounting for 26% of all new capacity added within 2024. Florida comes next.
Outlook
As the new government under Donald Trump gets ready to take charge of the US administration, analysts at Wood Mackenzie expect the growth to remain flat over the next 5 years due to broader industry challenges of lack of labor availability, high voltage equipment constraints, and interconnection delays.
For 2024, they project a 2% YoY decline to 40.5 GW DC, owing to a 26% decline in residential installations. From 2025-2029, the report guides for average annual volumes of at least 43 GW DC. The report writers add that this forecast is based on the current policy status quo.
“Our current outlook for the next five years has the U.S. solar industry growing 2% per year on average, reaching a cumulative total of nearly 450 GW by the end of 2029,” said the Head of solar research at Wood Mackenzie and Lead Author of the report, Michelle Davis. “Demand for solar remains robust, and annual installation forecasts would be higher if not for limitations the industry faces, including those related to interconnection, labor availability, supply constraints, and policy.”
The complete report can be purchased from Wood Mackenzie’s website for $7,500.