US Installed 5.4 GW DC New Solar in Q3/2021

• US added 5.4 GW DC of new solar PV capacity during Q3/2021, according to the SEIA and Wood Mackenzie
• Utility scale solar additions were the highest with 3.8 GW DC, followed by residential solar at 1.07 GW
• With 6.1 GW DC of new utility scale PPAs signed in Q3/2021, the US had 81 GW DC of contracted utility scale solar pipeline
• Analysts have lowered their previous guidance for 2022 by 25% citing supply chain issues as projects get pushed back

Logistical challenges and price increases in the global solar supply chain are expected to wipe off as much as 25% or 7.4 GW of forecasted solar installation in 2022 in the US, according to the Solar Energy Industries Association (SEIA) and Wood Mackenzie analysts. However, installations are set to exceed 20 GW DC in 2021.

In their latest edition, US Solar Market Insight Report 2021 Q4, the analysts do see a ray of light in the form of the Build Back Better (BBB) Act of the US government. If enacted, the US can install 43.5 GW of additional solar capacity between 2022 and 2026, a 31% increase to the base case forecast offered by the duo. It would take the country's cumulative installed solar power capacity to add up to 300 GW.

In case of the BBB Act becoming a law, as many as 14 US states will see 'at least a 1 GW boost in solar deployment' in the next 5 years, and 14 more will see 'at least a 500 MW boost'.

"On the one hand, supply chain constraints continue to escalate, putting gigawatts of projects at risk," explained Principal Analyst at Wood Mackenzie and Lead Author of the report, Michelle Davis. "On the other, the Build Back Better Act would be a major market stimulant for this industry, establishing long-term certainty of continued growth."

Q3/2021

Meanwhile in Q3/2021, the US installed 5.4 GW DC of new solar capacity, improving 33% on annual basis making it the 'largest Q3' on record (see US Installed 3.8 GW DC New Solar In Q3/2020).

To this figure, utility scale installations contributed the maximum with 3.8 GW DC led by Texas and Virginia, followed by residential solar adding 1.07 GW, commercial solar accounting for 327 MW DC, and community solar another 180 MW DC.

During the period, a total of 6.1 GW DC of new power purchase agreements (PPA) for utility scale installations were signed. At the end of Q3/2021, the US had 81 GW DC of contracted utility scale solar pipeline. This segment is most impacted by supply chain woes as the analysts point out their equipment is sourced from overseas.

"National system prices have increased 11.7% for fixed-tilt projects and 8.5% for single-axis tracking projects since Q4 2020," adds the report. "As developers grapple with equipment delays, higher equipment costs and contract negotiations, the online dates of multiple gigawatts of projects have been pushed from 2022 into 2023 or later. The projects likely to come online next year already have secured equipment."

As per the draft BBB Act released by the US Senate Committee on Finance, the US government is planning to incentivize domestic solar PV manufacturing.