Analyst: Strengths, weaknesses illustrated in CA’s solar market

New data from the California Solar Initiative (CSI) reflects fundamental interest in the US for PV solar systems, but also highlights some of the sector’s weaknesses, according to one analyst.

May 10, 2010 – New data from the California Solar Initiative (CSI) reflects fundamental interest in the US for PV solar systems, but also highlights some of the sector’s weaknesses, according to one analyst.

Two key trends can be gleaned from the CSI data (chart below), notes Gartner analyst Alfonso Velosa, in a research note:

  • Residential adopters of PV systems continue to drive the market. Average rate of installation over the past 16 months is 6.2MW, with little swings up or down due to seasonality. And enterprise PV installations are characterized by significant fluctuation.
  • Enterprise market demand reflects a double-whammy from the economic crisis. Not only were limited funds available to anyone seeking to take advantage of the Investment Tax Credit from 2008 — but there was a six-month delay between approval of the government stimulus program, and the feds’ ability to clarify its procedures. The end result was a lot of enterprise projects put on hold while companies sought clarity on what funds they could obtain; i.e. what their return-on-investments would be.
Click to Enlarge
California PV market by host sector (MW basis). Source: Gartner




Looking at 2010, the picture for enterprise PV installations in California seems brighter, with a >200MW pipeline of enterprise projects. But Velosa cautions that not all of these will get done, due to two core issues:

  • Finance. The climate has improved over the past couple of quarters, and vendors have been able to raise funds for both construction and projects overall — but this “historic problem” is still a concern.
  • Permitting. A bigger concern than financing, though, is navigating the specific processes for each locality, and establishing & leveraging local relationships and local experts.

 

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