That’s according to GTM Research and the Solar Energy Industries Association (SEIA), which together recently released their quarterly report showing that two-thirds more solar photovoltaic (PV) capacity was added in the first quarter of this year than during Q1 of 2010. At the start of April, the cumulative size of all grid-tied solar installations stood at 2.85 gigawatts — enough oomph to power about 600,000 U.S. homes.

Nearly half of all solar-panel systems were installed in sunny California, with about one-sixth in New Jersey, the country’s second-biggest solar market. The rest were installed in Arizona, Pennsylvania, Maryland, Colorado, New York and other states.

Beyond the growing number of solar installations, the report focused also on domestic solar panel manufacturers, finding that U.S. factories churned out 348 megawatts of solar panels, up a third from a year ago.

While America is making more solar panels and related equipment now than in years past, our share of the global market has shrunk: 15 years ago the U.S. made about 40 percent of the world’s solar panels; by 2008, that figure stood at just over five percent.

Still, it seems there’s a lot to like about the U.S. solar power market.

“On the whole, the U.S. is currently the PV industry’s most attractive and stable growth market,” said Shayle Kann, Managing Director of Solar at GTM Research. “This is reflected in our report’s quarterly market data and in the comments from global suppliers, distributors, and developers, all of whom see the U.S. positioned to nearly double its global market share in 2011 and support a greater diversity of installation types than has been previously seen in any leading demand center.”

See the full GTM Research and SEIA report: U.S. Solar Energy Industry Continues Record-Setting Growth in 2011

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[b]ack in 2004-2005, California accounted for a whopping 80 percent of the U.S. market. In 2010, that share fell to 30 percent, with 258.9 megawatts of the 878.3 megawatts of photovoltaic power installed that year …

If California’s share of the solar pie is shrinking, it must mean that other states’ are growing.

New Jersey in 2010 maintained its number two spot, installing about 137 megawatts (MW) of solar power — roughly equal to about 27,400, 5-kilowatt (kW) residential home energy systems.

Other gainers include Nevada, Texas, New Mexico and North Carolina — but note that these states solar markets are dominated by big, utility-scale solar power plants. Residential solar energy systems, in other words, don’t yet make up a meaningful share of the pie in these states.

Credit: U.S. Solar Market Insight: 2010 Year in Review

Why aren’t more Nevada homeowners installing solar panels? My guess is that it’s because Nevada — along with Texas, North Carolina and New Mexico — doesn’t have in place a statewide residential solar rebate program or similar incentive. Despite a 30-perent solar tax credit from the federal government, homeowners in these states aren’t quite there yet.

Another noteworthy trend is occurring in Pennsylvania, which has gone from a solar zero to solar hero in just a couple of years. In 2009, for example, the Keystone State saw just 3 MW of solar installed — in 2010, that figure rose to 47 MW. The data suggest the number of Pennsylvania solar panel installations will to continue to grow.

So, to sum up: California is still a big piece of America’s solar energy market. No matter how you slice it, however, other states are stepping up to challenge its claim to first place.

See the full Solar Energy Industries Association and GTM Research report: U.S. Solar Market Insight: 2010 Year in Review (PDF).

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As it stands, the program gives a 30 percent cash rebate to commercial developers of renewable energy systems. The program was initially a 30 percent tax credit before the American Recovery and Reinvestment Act of 2009 turned it in to a cash incentive. The possibility of the program reverting back to a cash incentive on January 1st lit a fire under the leaders of the U.S. clean energy industry, who credit the cash version of the program with jump-starting thousands of clean energy projects throughout the country.

With the economy still not at full strength, these leaders began tirelessly lobbying Congress to extend the  cash grant, saying that many planned projects can’t be built without it because they won’t have sufficient financial backing. Consequently, tens of thousands of renewable energy jobs would be in danger.

As of a month ago, it was unlikely that the lame-duck congress would have enough clout to extend the program. But extensive lobbying by industry leaders like the Solar Energy Industries Association (SEIA) and key house democrats like Montana’s Max Baucus, Iowa’s Tom Harkin and North Dakota’s Kent Conrad pushed congress into action.

While not official, the measure is expected to pass during a vote this coming Monday as part of a revised compromise tax bill. Here are list of energy related measures that are included in the bill, courtesy of Brighter Energy:

• The start-of-construction deadline for the cash grant in lieu of tax credit program, established in Section 1603 of the American Recovery and Reinvestment Act.
• The current per-gallon tax credits and outlay payments for ethanol as well as the existing 54 cents per gallon tariff on imported ethanol and related 22.67 cents per gallon tariff on ETBE.
• The dollar-per-gallon production tax credits for biodiesel and for diesel fuel created from biomass, as well as the 10 cents-per-gallon small agri-biodiesel producer credit.
• The credit for manufacturers of energy-efficient residential homes.
• The Section 45M credit for US-based manufacture of energy-efficient clothes washers, dishwashers and refrigerators.

As soon as the vote takes place next Monday, GetSolar will give you the final tally. You can find out more about the benefits the grant extension will bring to the renewable energy industry here.

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The report was released in Cancun, Mexico, where United Nations leaders are meeting throughout early December in order to decide whether or not to extend the Kyoto Protocol. SEIA’s report couldn’t have been more timely.

According to the trade group’s numbers, the United States would have to install 139 GW worth of solar capacity if the world is to reach the 2020 prediction. That would mean that, within a decade, 4.9 percent of all of the energy used in the U.S. would come from solar power. That figure now stands at less than one percent. It would also mean that 683,000 Americans would be working in the solar energy sector, and the price of installed solar panels will have dropped from its current rate of $5.71 per watt to $2.32 per watt.

There are some naysayers who believe the SEIA report’s figures are too high. Vice President of Marketing at SolFocus, Nancy Hartsoch, is among them. Her Palo Alto, California-based company makes concentrating solar photovoltaic (PV) panels, and she says there are two reasons why 980 GW by 2020 is unlikely. One is that a tremendous amount of money will be needed just to make the materials needed to reach such a gigawatt figure — money that simply isn’t available right now. The second reason is that, throughout most of the world, solar energy has yet to reach grid parity — the point at which solar energy is equal to or cheaper in cost than traditional grid power energy.

The adoption of that much solar power likely means that much stricter clean energy policies would have to be adopted around the globe, which is the point of the current Cancun, Mexico meetings. On December 6, the solar groups present at the meetings will discuss the solar standards of 20 countries and the European Union. What results from those talks may either support or discredit SEIA’s 980-GW thesis.

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Yesterday, the organization introduced a new campaign entitled “The Solar Generation USA Road Trip,” during which award-winning director Alan Blake took a 3-week trip from Cape Cod, Massachusetts to Los Angeles, California in order to film short online and broadcast segments from different parts of the country. The shorts showcase how America’s solar industry is saving property owners money on utility bills and putting everyday citizens back to work. In total, the campaign includes three “webisodes,” a four-minute film and a public service announcement.

SEIA President and CEO Rhone Resch explained why his organization decided to invest in the new campaign:

“Solar energy is working for America, creating good jobs and investment in all 50 states. Whether it is an installer, or a solar manufacturing line worker, or a family or business that has experienced the benefits of solar, the Solar Generation USA road trip captures just how far solar energy has come in the United States.”

Check out Webisode #1.

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Senator Cantwell and SEIA head Rhone Resch yesterday made their case, citing a new report commissioned from EuPD Research. The report focuses on the economic impact of: (1) the Department of Treasury Grant Program, which enables businesses that install solar (and other forms of renewable power) to receive, in lieu of tax credits, cash grants worth 30 percent of project costs; and (2) the Solar Manufacturing Investment Tax Credit, a program that extends a 30 percent investment tax credit to manufacturers that make qualifying renewable energy equipment, like solar panels, here in America. Both the renewable energy grant program and the solar manufacturing tax credit were created by Congress under the American Recovery and Reinvestment Act of 2009. The aim was to stimulate the creation of domestic, solar-industry jobs and encourage solar technology development.

The programs, however, are set expire at the end of 2010.

The findings of the Cantwell-SEIA report support the extension of both programs. According to the analysis, implementing both through 2012 would create 200,000 new jobs nationwide, and lead to the installation of another 10 gigawatts (GW) of solar energy systems by 2016 — enough to power 2 million homes.

“The solar industry was one of the bright spots in our economy with the creation of 17,000 new jobs [in 2009],” said Rhone Resch, President and CEO of the SEIA, when speaking in favor of extending both federal programs. “These jobs were created by the Recovery Act, and it’s time for Congress to extend the programs that have given new opportunity for Americans in the solar industry.”

According to the economic impact analysis, California stands to benefit the most in terms of new jobs and added solar capacity. The report notes the Golden State would gain 60,000 news jobs and over 4,400 megawatts of solar installations by 2016.

John Stanton, Vice President of Government Affairs for SolarCity in Foster City, California is another influential voice in the industry that is speaking loudly in favor of extending at least one of the programs. He had the following to say:

“The Treasury Grant Program is essential to keeping project financing—the lifeblood of the solar industry—moving forward. SolarCity has hired more than 300 people in the last 12 months and believe we and others in the industry can continue replacing jobs lost in the recession as long as this critical program [TGP] is extended.”

The fate of the two programs has not yet been decided. According to the SEIA Executive Summary, the extension of both programs would amount to an increase in U.S. investment in solar technologies by $39 billion and create 207,000 new jobs, both by 2016.

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The Solar Bill of Rights is part policy, part advocacy — it was written to help expand the American solar market by outlining basic policy requirements and educating the public on the benefits of solar energy. We’re including it here, for your reading pleasure. But don’t just read it — sign it! A strong solar industry is consistent with a strong America.

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Home solar installations comprised in large part the 37 percent growth in total installations over 2008. Solar hot water heating didn’t do quite so well, but still managed a respectable 10 percent growth over 2008. However, solar pool heating–often considered a luxury item and not eligible for many of the same incentives as other solar energy systems–fell by 10 percent.

And during the year of high unemployment rates and financial hardship for many Americans, the SEIA report says that the solar industry was doing its part by providing clean energy jobs: “In total, the solar industry and its supply chain now support roughly 46,000 jobs in the U.S. With growth expected to continue, that number is likely to surpass 60,000 by the end of 2010.”

Federal tax incentives and state regulations were credited with driving growth across all sectors. American Reinvestment and Recovery Act (ARRA) funds have found their way into many state budgets to support clean energy programs, so the two are heavily intertwined. California solar continued to lead the way with the most new installations (220 megawatts) and the highest overall solar capacity (1,102 mW), while New Jersey was a firm runner up (57 mW and 128 mW, respectively).

Effects of the economic downturn were most clearly seen in total grid-tied solar electric growth, which at 38 percent “fell short of the 84 percent growth in 2008.” Yet cost continued to fall dramatically–although home solar installations are more labor-intensive than large commercial systems and therefore more expensive, and industry growth relied heavily on the residential sector in 2009, installation costs still fell by about 10 percent overall. This is because solar module prices have been decreasing sharply due to technology advances and cheaper materials; because solar panels account for such a hefty percentage of total cost, any significant change in their market value will be reflected in the end cost to the consumer.

The SEIA report predicts that 2010 will be a banner year for solar growth in the U.S. The industry group is pushing hard for the federal government to extend its current alternative to the 30 percent tax credit for commercial solar installations–with tax equity at a nearly all-time low, the traditional investment tax credit is of little or no use for most businesses. To address this, it’s currently possible to receive an equivalent amount as a grant. If this alternative expires as planned at the end of the year, it could put a damper on larger-scale solar moving forward.

All things considered, the solar industry performed remarkably well across all sectors last year. Home solar certainly took the cake, indicating that solar’s unique ability to fill the small-scale distributed generation energy market is becoming more widely recognized and accepted. As more states begin to offer their own solar rebates and as the cost of solar technology continues to fall, we should have many more years of solid growth. A robust solar market can and will play into the health of the American economy in the future. The positive trends even in a year of severe recession demonstrate that this is one industry doing things right.

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I’ve discussed the desert solar battle on this blog before, so I won’t go into it too much now. Suffice it to say that both sides make some very good points, but the solar industry feels that a loss of momentum now in some of its most promising markets–Arizona and California–would be a tough blow from which to recover. The op-ed puts SEIA’s industry-leading expertise and authority clearly on the side of the developers:

Solar is thriving in 2010, due in large part to policies at the state and federal level. The Arizona Corporation Commission’s Renewable Energy Standard, federal solar investment tax credits, pro-solar stimulus bill provisions, the Bureau of Land Management’s efforts to streamline solar development and state tax credits for solar manufacturing all have the industry poised for robust growth, both in Arizona and across the country.

Resch and Fanshaw call out the cavalry in support of solar development: economic growth, in particular job creation; the ability to develop solar while respecting and preserving natural habitat; the need to begin the shift away from our dependence on foreign oil; and the big gun, climate change.

Environment America and the Solar Energy Industries Association have been fighting for a robust climate and energy bill because of what it could mean, not only for Arizona’s economy and environment, but for our country and world. It is important that we continue to move toward a future that provides good jobs and clean energy, while protecting America’s wildlife and habitat. With utility-scale solar power, we can do all three.

But let’s not forget about distributed generation while we’re mired down in this utility-scale struggle: rooftop solar panel arrays like home solar systems and small commercial solar installations are an important piece of the energy puzzle. In Arizona, major utilities APS and SRP both offer strong incentives to help lower the cost of a solar installation. The federal investment tax credit, which was in fact extended on Resch’s watch, will offset a further 30 percent of the cost of solar. Arizona solar installations on a small scale are in many ways a no-brainer: excellent ROI, clean energy, great use of the state’s most plentiful natural resource, and no need to do environmental feasibility studies before proceeding.

Just to prove that small-scale solar energy systems are viable even in less hospitable climes, check out the (relatively) live feed of Resch’s solar home: a 6.05 kw rooftop solar panel installation on his family’s home in Washington, DC. I think this is called “walking the walk”.

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As it stands, the federal Investment Tax Credit (ITC) permits homeowners who install solar energy systems to receive a 30 percent personal tax credit. (The ITC also applies to businesses, while a separate federal program allows companies to receive a renewable energy grant worth up to 30 percent of installed costs, for systems installed in 2009 and 2010). Without a doubt, raising the ITC to 50 percent for 2010 would make solar energy a viable energy solution for more individuals than under the business as usual case. This would mean more economic activity and more solar power — two things many people think this country needs more of these days.

Whether a 50% ITC is politically feasible is anybody’s guess. But it can’t hurt to try. If you’d like to help, visit SEIA’s section on Government Affairs and Advocacy. Write your representative and let them know you’d like to see the ITC raised to 50 percent for residential solar installations.

Stay tuned on the GetSolar blog for more updates.

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