Abstract
The United States has become one of the more aggressive nations in promoting
alternative energy technologies, but at the federal level tax credits and
depreciation incentives are not currently enough to encourage sustainable
demand growth. Instead, some states and municipalities have taken the lead in
providing incentives through a variety of mechanisms ranging from upfront
rebates and property tax credits to renewable energy credits and even
European-style feed-in tariffs. Pike Research' s extensive interviews with both
end-users and manufacturers conclude that for sustained growth in the U.S.,
incentives must be increased at the federal level. Due largely to the credit
crisis, funding for solar projects has been tight. In the U.S., this has
particularly been the case, because banks are unwilling to lend to projects
that have undetermined cash flows.
Our five-year outlook is that the combination of federal and state incentives
and falling module prices will work together to dramatically increase demand
in the U.S. As more banks become comfortable with funding these projects, and
find ways to securitize the cash flows, we believe it will become an
attractive revenue stream for solar lending divisions. Utilities, which are
just now getting serious about meeting RPS goals, will likely take the lead in
developing new solar projects. Until now, they have been unsuccessful in
getting support from their ratepayers who would see up to a 10% increase in
their utility bills. However, we believe that the emphasis that the Obama
administration is placing on climate change will eventually filter into the
fabric of American society, propelling the U.S. into a global leadership
position in solar PV market share by 2014, according to our most recent
forecast.
This Pike Research report examines demand-side dynamics for solar PV projects
in depth, analyzing government incentives, financing structures, and internal
rates of return on a state-by-state level. Cost components for solar project
development are quantified in detail, and the report also includes forecasts
for leading solar PV markets around the world in addition to the U.S.,
providing a clear and actionable view of the size and timing of market
opportunities.
Key questions addressed:
- Which states provide the best subsidies to supplement federal tax credits?
- How has the global credit crisis impacted solar demand, and what is the
current financing environment?
- What are recent trends in pricing for fully installed solar PV systems?
- Why do lower installed costs have little impact without easing of credit?
- What are the key government subsidy mechanisms for encouraging solar
demand?
- How will profitability be distributed within the solar value chain?
Who needs this report?
- Utilities
- Solar Project Developers
- Solar Installers/Integrators
- Solar Cell and Module Manufacturers
- Solar Equipment Vendors
- Government Energy and Environmental Agencies
- Investment Professionals
- Solar Industry Associations
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