California and North Carolina to Achieve Top-10 ‘Country’ Status in 2014 Global PV Industry

The US solar PV industry continued to set new installation records in 2013, surpassing previous demand levels for both quarterly and annual periods. The new installation rates confirm that the US is now the leading market outside of the Asia-Pacific region.

However, despite having grown to above 4 GW, to refer to the US as a ‘single’ country market misses many of the nuances underlying the market at the state level. The US is one of the more complicated markets for PV industry participants to understand.

When discussing trends in the US market, it is common to use the phrase: ‘there is no US market; there are 50 state-level markets with a layer of federal policy on top’. And then there are more than 2,000 utilities that can have unique permitting, licensing, or incentive policies.

Because of this complexity, each state has different segmentation trends, business models, and challenges. In addition to having a strong influence on the size of the US market, the leading states are large enough to influence the global supply/demand landscape. The figure below examines four of the top US state markets and ranks them against other single-country global markets.

If each US state were analyzed as an individual market, California would rank as the fourth largest driver of PV demand globally during 2013. During 2014, we forecast that North Carolina will join California as a global Top-10 driver of PV demand. Furthermore, at least four states will be in the Top-20 for global demand in 2014.

While there are policy/regulatory differences between these states, they all share the same federal policy environment, linguistic/cultural background, and legal framework. This makes entering new markets within the US potentially easier than shifting sales/marketing resource between different Asian or European markets. There is also the added benefit that all states fall under the same trade authority, meaning there is less ambiguity surrounding any trade issues.

Therefore, all PV participants – whether upstream or downstream – that aspire to participate within the global PV industry need to have clear plans not simply for the whole US market, but also the key states like California and North Carolina.

Figure: Top US States in Global Rankings

Source: Adapted from NPD Solarbuzz North America PV Markets Quarterly and Solarbuzz Quarterly