The Energy Industry is widely spread with many options. From oil to coal, natural gas to wind, there is no shortage of sources to power our future. But one source stands out from the crowd: solar. Solar power is on a growth trajectory that rivals a freight train at full steam ahead. It is inevitable and unstoppable.
According to the U.S. Department of Energy, the modern photovoltaic (PV) solar cell was developed in 1954 at Bell Labs.1 Just look how far we’ve come since then – consumers can purchase a residential solar power system at their local hardware store. That’s not to say that the best days of growth are behind us. Quite the contrary, as secular technology increases, applications to solar efficiency and cost reductions are being unlocked that can help propel adoption worldwide.
How has that adoption come along so far? According to the Solar Energy Industry Association, over 64 GW of total solar capacity has been installed, and installations have an annual growth rate of 50% over the last decade. “Just five years ago, the solar industry installed less than 5,000 MW of capacity annually. In 2018, the U.S. solar market was more than double the size — with over 10,000 MW installed.”2 The U.S. solar market has doubled in just the last five years!
Manufacturing cost reduction is the biggest opportunity to bring solar prices down for consumers. There may be a volume-leverage benefit as the industry grows and fixed costs can be absorbed by higher volumes. Per the SEIA, the “total installed U.S. PV capacity will more than double over the next five years.”3 Raw material costs have been coming down. Polysilicon $/kg has declined by almost 50% just in the last year. With the raw material costs down, it’s time we all address the soft costs to bring them in line.
Another tailwind for the industry is the fact that governments and setting legal mandates and renewable portfolio standards (RPS), requiring the use of renewable energy. Per the Deloitte 2019 Renewable Energy Outlook, “Today, half of the states with RPS targets are poised to reach them by 2021, and several are mulling an increase. A few are even targeting 100 percent renewable's. For example, Hawaii set the ball rolling with its “100 percent by 2045” target, and California followed its lead with the same goal. Washington, DC and Michigan have also recently been considering a 100 percent goal. At the same time, several other states such as Vermont, Massachusetts, Connecticut, and New Jersey, while stopping short of 100 percent, have significantly increased their RPS targets.”4 Additionally, over 200 mayors from around the United States have signed the Environment America Research & Policy Center’s “Mayors for Solar Energy” letter, calling for solar power to be a greater percentage of our total energy mix.5 California recently mandated that all new homes have solar panels.6 Outside the U.S., Germany has passed the German Renewable Energy Sources Act that promotes renewable energy generation. With governments around the world increasingly supporting and mandating renewable energy and solar power, it’s clear that this tailwind will become strong with time.
Solar energy is a renewable energy source that will continue to grow. Consumers around the world are asking for it. Governments and municipalities are pushing for it. Everyone can benefit from it in one way or another, even Mother Earth. External factors are driving the increased volume growth for solar manufacturers. It’s up to the manufacturers themselves to help reduce the costs associated with solar power for everyone.
About ABT Auto Bond Technology (formerly Solar Equipment Systems, LLC):
ABT is a solar energy solutions company focused on reducing the costs of solar energy manufacturing and production. Our key technology robotically automates a highly wasteful and labor-intensive process in the PVD sputtering target to backing tube bonding process, which is a consumable in the manufacturing process of thin cell solar panels. For further information, please visit our website: