Solar Electric Power

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 180 solar electric power companies in the US operate solar electric power generation facilities that use energy from the sun to produce electricity, which is provided to electric power transmission systems or electric power distribution systems. Utility-scale solar is generally defined as a facility with generation capacity of one megawatt (MW) or more, which is sold to utilities or wholesale electricity buyers.

Reliance on Government Incentives

Because the cost of solar power exceeds the cost of power furnished by the electric utility grid in most locations, the industry relies on government incentives, mandates, and policies that support investment in alternative energy sources.

Dependence on Geographical and Seasonal Factors

Production and capacity factors are affected by geographical and seasonal considerations.

Industry size & Structure

The average solar power generator employs about 15 workers and generates about $10 million annually.

    • The solar power generator industry consists of about 180 firms that employ about 2,800 workers and generate almost $2 billion annually.
    • The industry is highly concentrated; the top 20 companies account for 88% of industry revenue.
    • Large firms include First Solar, EcoPlexus, 8minute Solar Energy, and sPower.
                                Industry Forecast
                                Solar Electric Power Industry Growth
                                Source: Vertical IQ and Inforum

                                Recent Developments

                                Nov 9, 2022 - Panel Shortages Slow Solar Development Projects
                                • Solar installations of 1,877 megawatts (MW) in Q3 2022 were down 23% compared to Q3 2021, according to the American Clean Power Association’s (ACP) latest Clean Power Quarterly Market Report. Solar capacity additions have been slowed by a shortage of solar panels, in large part due to US Customs enforcement, including under the Uyghur Forced Labor Prevention Act. Despite delays and rising costs, the pipeline of new renewable projects is robust. At the end of Q3 2022, solar accounted for 60% of the renewable project pipeline, with 78,181 MW in development. Texas leads the nation with the largest amount of solar capacity in the development pipeline, followed by California and Indiana. While the renewables sector faces some short-term setbacks, the ACP anticipates the Inflation Reduction Act (IRA) will help bring 550 gigawatts of clean energy online by 2030.
                                • Three-quarters of US adults say they would be interested in a job in the green industry sector, according to a recent survey by Mosaic, a firm offering financing for home solar installations. About a third of respondents said they felt their current level of experience and education make them well-qualified for green economy jobs, including solar, wind, geothermal, electric vehicles, and sustainable home improvements. Two-thirds of those surveyed said they would likely require on-the-job training to perform green energy jobs. Mosaic conducted the survey to better understand the US workforce’s willingness and ability to do green energy work amid widespread labor shortages. The IRA is expected to create more than 9 million jobs over the next 10 years, according to analysis by environmental group the BlueGreen Alliance and the Political Research Institute at the University of Massachusetts Amherst.
                                • The Inflation Reduction Act (IRA) is expected to drive new and innovative investments that combine wind and solar power generation with battery storage, according to Utility Dive. In late September, the Wheatridge Renewable Energy Facilities project opened in Oregon. A joint investment between NextEra Energy Resources and Portland General Electric, the project is the first in the US to combine utility-scale wind and solar with energy storage. Most renewable energy storage projects usually have been paired with solar projects, partly because energy storage was only incentivized by tax policy when it was associated with solar installations. Under the IRA, energy storage is incentivized as its own asset class and can be mixed and matched with various renewables in new ways.
                                • As the US continues to make investments in solar energy, the industry will have to reckon with how to recycle solar panels once they reach the end of their lifecycle, according to Waste Dive. Washington state has rolled out the country’s first extended producer responsibility (ERP) program that could lay the groundwork for how recyclers manage solar panel materials and how manufacturers might be able to incorporate the materials in making new panels. Key recyclable solar panel materials include glass, aluminum, copper, and semiconductor material. The market for recycled photovoltaic materials could reach $15 billion by 2050, according to the International Renewable Energy Association.
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